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Appeals Nos. 244 and 245 of 1958. Appeal by special leave from the judgment and decree dated February 19, 1953, of the Madras High Court in Second Appeals Nos. 2120 and 2121 of 1947. A. V. Viswanatha Sastri and M. section K. Iyengar, for the appellants. K. N. Rajagopala Sastri and M. section K. Sastri, for respondent No. 1A. section V. Venugopalachari and R. Gopalakrishnan, for respondent No. 8A in Appeal No. 244 and respondent No. 7A in Appeal No. 245. April 27. The Judgment of the Court was delivered by SUBBA RAO, J. These two appeals are directed against the judgment of the High Court of Madras dated February 19, 1953, setting aside that of the District Judge, Tirunelveli, and restoring that of the Subordinate Judge, Tuticorin, in O. section Nos. 45 and 46 511 of 1945 on his file, and they raise the question of maintainability of a suit in regard to honors and perquisites in the temple of Athinathalwar in Alwar Tirunagari. At Alwar Tirunagari in Tirunelveli District there is a famous temple called Athinathalwar temple. The presiding deity in the temple is Lord Vishnu. Its origin is lost in antiquity. In 'the 10th and 11th centuries Vaishnavite saints, called Alwars and Acharyas, who were ardent devotees of Lord Vishnu, worshiped at the temple and sang in praise of the Lord. As time passed by, 20 smaller temples were erected to commemorate the lives of Alwar8 and Acharya8. Within the compound of the main shrine, there are three minor shrines of Nachiar, Nammalwar, and Garuda; the rest of the smaller shrines are outside the premises of the main temple. Each of the said temples has its own manager, archakas and separate endowments; but, presumably because of the fact that the Alwar8 and Acharyas, whose idols are installed in the smaller temples, were originally devotees of Sri Athinathalwar, an interesting and novel practice of mutual and regular exchange of visits between the idols in the smaller shrines and the idol of Athinathalwar has grown over the years. During certain specified occasions in the year, the idols in the minor temples are brought to the main temple for worship; so too, on specific occasions the idol of Athinathalwar is also taken to the minor shrines; such visits being reminiscent of the days when the Alwars and Acharya8 worshiped in the temple of Athinathalwar. Sri Ramanujacharya was one of the greatest of the devotees of Lord Vishnu and is well known throughout this vast country as the progenitor of an important school of Indian philosophy. He died in the year 1127 A. D. In the 13th century a shrine was built in his honour and his idol was installed therein. Sri Ramanujacharya is also known as Udayavar or Emberumanar and the shrine built in his dedication is known as Emberumanar temple. The manager and archaka of the said temple is known as Emberumanar 512 Jeer. Emberumanar temple also is outside the precincts of the temple of Athinathalwar. There are also mutual visits between the idol of Emberumanar and the idol of Athinathalwar to each other 's temple. The present Emberumanar Jeer is the plaintiff in the suits out of which the appeals have arisen. There is a mutt called the Vanamamalai Mutt in the said District and the head of the mutt is known as Vanamamalai Jeer. He is a sanyasi held in reverence by Vaishnavites of South India. He is the first defendant. The heads of the Ahobilam Mutt and the Tirukkurungudi Mutt are the second and third defendants respectively. The fourth defendant is the Executive Officer of the temple of Sri Athinathalwar and he was appointed by the Hindu Religious Endowments Board, Madras. The records disclose that, at any rate from the middle of the last century, there have been disputes between the various Jeers and others as regards the order of priority in which certain honours have to be distributed among the said Jeers when they attend the temple of Sri Athinathalwar for worship. In the ghoshties (group of worshipers in front of the deity) both on ordinary and special days the said Jeers are shown honours befitting their rank. The honours consist of distribution of theertham, thulasi, satari and viniyogam, and a few more similar items. Each of the said Jeers is allotted a particular place in the ghoshti and a certain order of precedence is observed inter se between them. This order of precedence in the matter of receiving honours has become an unending source of bickering between the religious heads; with the result, the Madras Hindu Religious Endow ments Board, constituted under Act 1 of 1923, with jurisdiction to administer the endowments in the Madras State, had to interfere and settle the disputes inter se between the various Jeers. On May 12, 1927, the said Board fixed the order of precedence for honours between the various Jeers to be observed both on ordinary and special days. By the said order the Board recognized the Emberumanar Jeer 's right 513 to the honours and perquisites in precedence over the other Jeers on all the days other than Vaikasi festival days, except the 7th day, and as regards the other days of the festival, namely, 1st to 6th and 8th to 10th days, the Board directed that the other Jeers should be shown on the respective days both the ordinary and special honours in precedence over the rest of the Jeers, including the Emberumanar Jeer. Not satisfied with the said order, the Emberumanar Jeer filed O. section No. 320 of 1933 in the Court of the District Munsif, Tirunelveli, which was later transferred to the Court of the Subordinate Judge, Tuticorin, as O. section No. 45 of 1945, against the other Jeers and the Hindu Religious Endowments Board, for the declara tion of his right to the first theertham and other per quisites in precedence over all the others in the ghoshties of Sri Athinathalwar temple on the ground that he was entitled to them as the office holder of the, temple of Emberumanar. Subsequent to the filing of the suit, the Board, by its order dated May 15, 1935, altered the order of precedence giving the Vanamamalai Jeer precedence over the Emberumanar Jeer; and this led to the Emberumanar Jeer filing another suit O. section No. 201 of 1941 in the Court of the District Munsif, Srivaikuntam, for a declaration of his right to the first theertham, etc., in precedence over all the others. This suit was later transferred to the Court of the Subordinate Judge, Tuticorin as O. section No. 46 of 1945, to be tried along with O. section No. 45 of 1945. To the suits the Emberumanar Jeer, the Vanamamalai Jeer, the Ahobilam Jeer and the Tirukkurungudi Jeer, and the Executive Officer of the Hindu Religious Endowments Board were made parties. These suits have had a chequered career. But we shall briefly refer only to those stages of the long drawn litigation which have some bearing on the questions raised in the present appeals. O. section No. 320 of 1933 was finally numbered as O. section No. 66 of 1936 and was disposed of on March 25, 1941, by the District Munsif, Tirunelveli. The learned District Munsif dismissed the suit on the ground that it was not maintainable as the plaintiff had no legal right in respect 514 of which he could seek relief in a civil court. On appeal, the learned Subordinate Judge, Tirunelveli, came to the conclusion that, as the plaintiff had come to court to establish his right of precedence to receive the theertham, etc., as forming part of the emoluments of his office of aradanaikar in the suit temple, the suit could not be dismissed on the preliminary ground that it was barked under section 9 of the Code of Civil Procedure; on that basis, he set aside the decree of the District Munsif and remanded the case for trial on other issues arising in the case. Both the parties preferred appeals to the High Court of Madras and they were numbered as C. M. As. Nos. 1 and 155 of 1943; on January 31,1945, Chandrasekara Aiyar, J., dismissed both the appeals. The learned Judge propounded alternative theories, and he expressed himself thus: "Of course, before he (plaintiff) can succeed in the suit, the plaintiff has to make out that he being the Aradanaikar and trustee of the Emberumanar temple amounts to his holding an office in the suit temple." The learned Judge agreed with the Subordinate Judge that the suit could not be dismissed in limine without deciding the said question of fact. On remand, the learned Subordinate Judge, Tuticorin, to whom the said suit and the connected suit, being renumbered O. section Nos. 45 and 46 of 1945, were remanded came to the conclusion that the Emberumanar temple was a sub shrine attached to the main temple of Sri Athina thalwar, and that the plaintiff, who was the aradanaikar of the sub shrine, would be virtually an office holder in the main temple. He further hold that the privilege of first theertham was attached to the said office as part of its remuneration and, therefore, the suit was one of civil nature falling under section 9 of the Code of Civil Procedure; in that view, having held on the merits that the plaintiff had established his right of precedence, he decreed both the suits. As many as six appeals were preferred against the decrees in the two suits by the aggrieved parties to the District Court; and the learned District Judge in a common judgment disposed of them on January 23, 1947. 515 The learned District Judge, on a review of the evidence in the case, held that the institutions were not interdependent or intimately connected in such a way that an office holder of the Emberumanar temple was necessarily an office holder of the Athiiiathalwar temple. On that finding, he held that the plaintiff was not an office holder of the Athinathalwar temple and, therefore, he was not entitled to file a suit with regard to his rights of precedence in being given the theertham, etc. In the result he allowed the appeals and dismissed both the suits with costs throughout. Against the said judgment, the plaintiff preferred second appeals to the High Court of Judicature at Madras, being Second Appeals Nos. 2120 and 2121 of 1947. They were heard by Krishnaswami Nayudu, J., who on a reconsideration of the evidence disagreed with the finding arrived at by the learned District Judge and accepted the finding given by the learned Subordinate Judge. Not only the learned Judge accepted the finding of the learned Subordinate Judge that the plaintiff as the aradanaikar or the archaka of the sub shrine was virtually an office holder in the main temple, he also went further and held that, as one of the theerthakars, the plaintiff could be considered to be the holder of the office of arulipad in the main temple. In the result the learned Judge set aside the decree of the District Judge and restored the decrees of the learned Subordinate Judge. As leave to appeal to a division bench was not given by the learned Judge, the first defendant, i.e., the Vanamamalai Jeer, in the suits, by special leave, has preferred these appeals against the judgment of the High Court. Mr. A. V. Viswanatha Sastri, learned counsel for the appellant, raised before us the following points: (1) A suit for a declaration that the plaintiff is entitled to honours in a temple would not lie unless he establishes that he holds an office in the said temple and that the said honours form part of the perquisites attached to the said office, and that, as in the present case the plaintiff claimed that he was an aradanaikar and trustee of only the Emberumanar temple and as such entitled to honours in Athinathalwar temple, 516 the suits should have been dismissed in limine on the ground that the plaints did not disclose any claim of civil nature falling under section 9 of the Code of Civil Procedure. (2) The Courts were not justified in allowing the plaintiff to make out a now case not disclosed in the plaints, namely that the Emberumanar temple was a subordinate shrine of the Athi nathalwar temple and, therefore, the plaintiff was the office holder of the latter temple; assuming that there was justification for the courts in allowing the plaintiff to develop a new case at a very late stage of the proceedings, there was a clear finding of the District Court based on the evidence adduced in the case that the Emberumanar temple was not a sub shrine of the Athinathalwar temple, and the High Court had no jurisdiction to set aside that finding in second appeals. Mr. Rajagopala Sastri, learned counsel for the respondents, contended that the plaintiff 's alternative case was not really a new one, but all the relevant facts in support of that case were disclosed in the plaints, and that the finding of the District Judge was not a finding of fact but was either a legal inference from proved facts or a mixed question of fact and law. He argued that the contention of learned counsel for the appellant ignores the religious background and ideas of the class of persons with which we are now concerned, and that, if the matter is approached from a correct perspective, as the High Court did, it would be realized that there was such an association between the two temples as it could be said that one is subordinate to the other leading to the only irresistible inference that the plaintiff, the office holder of the sub shrine, could claim honours in the main temple of which the sub shrine is only a part in the larger sense. At the outset it would be convenient and necessary to notice briefly the law pertaining to the maintainability of suits in civil courts in respect of honours in temples. Section 9 of the Code of Civil Procedure describes the nature of suits which a court has jurisdiction to entertain. It can entertain every suit of a civil nature excepting suits of which its cognizance is 517 either expressly or impliedly barred. As a corollary to this, it follows that a court cannot entertain a suit which is not of a civil nature. Prima facie suits raising questions of religious rites and ceremonies only are not maintainable in a civil court, for they do not deal with legal rights of parties. But the explanation to the section accepting the said undoubted position says that a suit in which the right to property or to an office is contested is a suit of civil nature notwithstanding that such right may depend entirely on the decision of a question as to religious rites or ceremonies. It implies two things, namely, (i) a suit for an office is a suit of a civil nature; and (ii) it does not cease to be one even if the said right depends entirely upon a decision of a question as to the religious rites or ceremonies. It implies further that questions as to religious rites or ceremonies cannot independently of such a right form the subject matter of a civil suit. Honours shown or precedence given to religious dignitaries when they attend religious ceremonies in a tem ple cannot be placed on a higher footing than the religious rights or ceremonies, for they are integral part of the said rites or ceremonies in the sense that the said honours are shown to persons partaking in the ceremonies. Prima facie honours, such as who is to stand in the ghoshti, in what place, who is to get the tulasi, etc., in which order, and similar others, cannot be considered to be part of the remuneration or perquisites attached to an office, for they are only tokens of welcome of an honoured guest within the precincts of a temple. One would have thought that it would even be a sacrilege to claim a right of precedence in the presence of the Almighty God, for all go before him as humble devotees to earn his blessings and not to assert their self importance or claim their right to preferential treatment. But a century of case law in that part of the country has recognized certain rights of different grades of devotees and they and their innumerable followers began to cherish them or even to fight for them in criminal and civil courts. This Court, therefore, does not propose to reconsider the 66 518 question of honours on first principles but only will resurvey the law on the subject with a view to ascertain, and if possible to clarify, the legal position. The earliest decision is that in Striman Sadagopa vs Kristna Tatachariyar (1). There, the plaintiff was the gurukkal of Sri Ahobilam Mutt and he sued the trustees of Sri Devarajaswami temple at Conjeevaram for damages for injuries done to him by withholding from him certain honours and emoluments and also sought to have his right to such honours and emoluments established for the future. Two Schedules were attached to that plaint and they showed inter alia that what was claimed as honours were such as garlands, cocoanuts, prasadams and other paraphernalia attending the ceremonial recitation when the gurukkal visited the temple. Scotland, C.J., formulated the legal position thus: ". . . these clearly show that every one of the matters in respect of which the suit is brought is purely a matter of religious and sacred observance in connection with the worship and ceremonials at the pagoda, and is claimed by the plaintiff as a matter of devotional respect and display due to his priestly rank or as a votive offering made to him whilst passing in procession through the temples, and when brought to the presence of the principal idol. " Then the learned Chief Justice proceeded to state: "He (the plaintiff) is not officially connected in any way with the management or control of the pagoda, or its property or funds; and the alleged dues of his office have no doubt been owing to the great reverence at one time entertained for his sacredotal rank in the Hindu religion, and the importance from a religious point of view of his mere presence at the pagoda." He concluded thus: "Such honours and emoluments cannot in any respect be considered as remuneration for duties or ministrations performed by the plaintiff in the secular affairs or religious services of the pagoda." (1) ,3o6. 519 This decision, which has stood the test of time, clearly lays down that a suit to enforce the rights of persons holding offices connected with the management and regulation of temples and for honours and emoluments connected therewith would lie in a civil court; but a suit by a plaintiff, who does not hold an office in the temple, claiming honours customarily shown to him as a matter of devotional respect and display due to his rank is not of a civil nature. The principle laid down in this case and restated in subsequent cases has been applied by a division bench of the Madras High Court to a claim for first theertham, etc., in Sri Rungachariar vs Rungasami Buttachar (1). That decision was given in an appeal arising out of a suit for a declaration that the plaintiffs had a hereditary miras right to the offices of Sthalathar, Kutumba First Theertham, Muntrapushpam, Vedaparayanam and Adyapakam from times immemorial in the temple of Sri Parimala Ranga nathaswami at Tiruvilandur, and, by virtue of such right, were entitled to a fourth share of the honours and emoluments due to their offices as detailed in schedule A of the plaint. The learned Judges, on the evidence, came to the following conclusion: ". . the plaintiffs as hereditary Sthalathars are bound to perform, besides the duties of superintendence attached to their office of Sthalathar, the ceremonial duties of vedaparayanam, etc., and are entitled to receive remuneration for the performance of those duties. Included in this remuneration is the privilege of first theertham ' from which the plaintiffs are called 'theerthakars". Then the learned Judges proceeded to observe: "Taking the findings to be, as we do, that the privilege of the first theertham is attached to the hereditary office of the plaintiffs as a part of the remuneration of the office, the Court must, to protect the plaintiffs in the enjoyment of the office, declare what is the honour to which they are entitled. " This decision recognizes that a suit for a declaration of a plaintiff 's right to an office and for the honours, (1) Mad.291, 208.520 such as first theertham, etc., as part of the remuneration will lie in a civil court. Athan Sadagopachariar Swamigal vs Elayavalli Sri nivasachariar (1) is a decision relating to honours in Athinathalwar temple itself. The plaintiff in that case was a trustee of a temple called Pillalokacharyar 's temple. The principal object of the suit was to prevent the first defendant from claiming to be one of the Adhyapaka Mirasidars in the temple of Nammalwar and Adinathar in Alwar Tirunagari. It was contended that the first defendant was one of the seven Adhyapaka Mirasidars in the temple and his rank in the ghoshti was just above the plaintiffs. Sadasiva Aiyar, J., posed the question raised and gave his answer thereto thus: "The legal question I wish to say something about is whether a suit for the honours mentioned in the second item of the 2nd Schedule to the plaint is maintainable in a Civil Court. It is clear that if those honours are not attached to any office in the temple, no such suit could lie. The first branch of the question, therefore, is a question of fact, viz., whether these honours are attached to the Adhyapaka Miras office in the temple." After considering the evidence and other relevant decisions, the learned Judge came to the following conclusion: "I see no difficulty whatever in holding on the evidence in this case that the plaintiffs and the 1st defendant and the 5 other Adhyapaka Mirasidars get their rank in the Goshti and their rank in the distributions of prasadams not because those honours are part of the Adhyapaka Miras office to which they are entitled but because of their being Acharya Purushas or of their families having been very respectable religious families for long or because the mere respect due to their offices has been considered as making them fit in a social, and religious point of view to obtain such honours. " That would be enough to dispose of that appeal, but the learned Judge proceeded to make certain observations even on the assumption that the said honours (1) , 299, 300, 301. 521 had been attached to emoluments so far as the 7 Adhyapaka Mirasidars were concerned. The observations of the learned Judge, though obiter, deserve to be quoted not only because of his vast experience in matters of Hindu religion but also because of his well known reformative zeal to remove the cobwebs that shroded the Hindu religion by superstitious ignorance and perverted imposition. The learned Judge says: ". . the next question of law is whether such honours to be shown in the presence of God can be legally attached to the office as emoluments, in other words, can honours be legally claimed by anybody as receivable by him in a temple? When a trustee chooses to parade the temple elephants and dancing girls before a high official or any other person and gives him prasadams, etc., he does it in order to show 'honours ' to that person and when he does it without prejudice to the conduct of the rituals and ceremonies in the temple, he always says that the God of the temple Himself condescends to treat the official or other persons as God 's guest and shows him these 'honours '. Such persons to whom respect is shown cannot in my opinion claim such 'honours ' as a legal right, but as a favour shown by the temple Deity. Such honours in the strict eye of the Shastras cannot be called honours at all but as doles condescendingly given by the temple Deity as a 'favour '. One of the honours, as is well known, shown to a, Hindu in a Vaishnava temple is to place the impression of the feet of the Deity upon the head or shoulders of the devotee. Another is the distribution of the 'leavings ' of the food offered to the Deity to the distinguished devotee. The sandal paste of the feet of the Deity and the leaving of his food and the garland worn by the God are given as marks of pure grace and not as rights and hoilours claimable by the devotee. . This clearly shows that while we ought to humbly accept the Deity 's leavings given through the trustee or an archaka, a claim for 'honour ' to be shown in the presence of God is a sinful claim and is illegal and unshastraic. I would therefore respectfully confine the decision in Sri Bungachariar vs Bungaswami Buttachar(1) to cases in which the receiving of the first theertham by an office holder has become indissoluble part of the ritual to b e performed by the recipient as an office holder and the extension of the principle should be carefully guarded against. These are weighty observations and if they were appropriate in the year 1913 they should be much more so in the year 1961." We respectfully accept these observations as laying down the correct proposition, namely, that a party claiming an honour like first theertham, etc., has to prove not only that he is an office holder of the temple and that he has been receiving the first theertham in the Ghoshti but also that the receipt of the first theertham, has become an integral part of the ritual to be performed by him as an officeholder; for, the receipt of the first theertham would be consistent with its being shown as a grace from the Lord and also as its being a part of the remuneration to the office. Another division bench of the Madras High Court in Vathiar Venkatachariar vs P. Ponappa Ayyengar (2) had to consider the question of a claim to a religious honour which consisted of receiving theerthams and prasadams in the temple in certain order of precedence. This case also relates to Athinathalwar temple and to the question of precedence among the theerthakars. The first question raised was whether there was such an office as theertham office in the temple. Krishnan, J., delivering the leading judgment, in rejecting that there was such an office observed: "It may be mentioned that among the Theer thakars there are some 5 or 7 in number, who are called Adhyapakamdars, whose special duty it is to recite these Prabandams and they are remunerated by Inam lands given to them. They are what may be called the official reciters in this temple." Adverting to the question raised, the learned Judge proceeded to observe: "It is clear that, to constitute an office one, if not (1) Mad, 291, 298. (2) 961, 962.the essential, thing is the existence of a duty or duties attached to the office which the office holder is under a legal obligation to perform and the nonperformance of which may be visited by penalties ,such as a suspension, dismissal, etc." Applying the test in the case of Theerthakars and other Adhyapakamdars, the learned Judge said: "The only difference between the outsiders and the Theerthakars, as shown by the evidence, is that the Theerthakars have special places allotted to them in the temple to stand and recite and they are given the honour of Theertham and Prasadam, before the outsiders get them; and they have what is called an 'Arulapad ', that is, their names are called out by the Archaka in a certain order, when, if present, they have to respond by saying 'Nayinde ', meaning 'I am here '. This does not seem to show that they are anything more than a recognized and privileged class of worshipers who are shown special consideration by having places allotted to them in the temple and by being given the honours before the ordinary worshipers in an order of precedence fixed by the usage of the temple." On a consideration of the evidence in that case, the learned Judge stated: "On the evidence as set out it must be held that the plaintiffs have not made out the existence of any obligatory duty on the part of the Theerthakars or Of any office called the Theertham office." This judgment, therefore, establishes that there is no office called the theertham office in the temple, as there is no obligatory duty on the part of the said theerthakars in the temple. As the claim to the said honour was not established to have been attached as emoluments to the religious office the suit was dismissed. Sri Emberumanar Jeer Swamigal vs The Board of Commissioners for Hindu Religious Endowments, Madras (1) is a decision of a single Judge of the Madras High Court in a writ petition filed by Emberumanar Jeer questioning the order of the Religious Endowments Board which is the subject matter of (1) , 591. 524 the present appeals. That writ petition was dismissed on the ground that the Board 's order related to administrative matter and, therefore, a writ of certiorari would not lie to quash the same; but in the course, of the judgment, Pandurang Row, J., made certain relevant observations and they are: "What was determined by the Board was the order of distribution of theertham and honours connected with theertham. This matter cannot in my opinion be regarded as a determination of any rights of subjects. The rights of subjects referred to in the rule are rights which can be legally enforced and not mere honours or precedence claimed or recognized as a matter of courtesy or usage. It is not seriously disputed that the right to obtain the theertham or honours in a particular order of precedence is not a civil right which can be enforced or declared in a Civil Court." After citing the observations in Sriman Sadagopa vs Kristna Tatachariyar (1), the learned Judge observed: "Indeed the rule that Civil Courts cannot take cognizance of claims to mere honours or privileges of the nature referred to above has been unquestioned for many years and every attempt to evade that rule has met with failure." The observations of the learned Judge are rather wide, for, as the earlier decisions show, though a suit for privileges or honours per se may not lie in a Civil Court, if they are annexed to an office, they can be agitated therein. This judgment was taken in appeal to a division bench of the High Court, consisting of Leach, C. J., and Somayya, J., who confirmed the same. They observed: "It is acknowledged that a question relating to the distribution of theertham or other temple honours cannot be made the subject matter of a suit as it is not a question which affects a legal right." The remarks we made in regard to the observations of Pandurang Row, J., would equally apply to these observations. They do not represent the entire law on the subject, but only a part of it. (1) 525 It is not necessary to refer to further citations, for the decisions already cited lay down the relevant principles of law clearly. For convenience of reference we may summarize the law on the subject thus: (1) A suit for a declaration of religious honours and privileges simpliciter will not lie in a civil court. (2) But a suit to establish one 's right to an office in a temple, and to honours and privileges attached to the said office as its remuneration or perquisites, is maintainable in a civil court. (3) The essential condition for the existence of an office is that the holder of the alleged office shall be under a legal obligation to discharge the duties attached to the said office and for the non observance of which he may be visited with penalties. (4) So judged, there cannot be an independent office of theerthakar, for a theerthakar has no obligatory duties to perform; nor can there be an office of arulipad; the said word only connotes that the names of the theerthakars are called out by the archaka in a certain order. (5) Even if theertham is given or other honours are shown in a particular order to a person holding an office, it does not necessarily follow that the said honours are part of the remuneration attached to the office; but it is a question of fact to be ascertained on the evidence whether the said honours are attached to the office as part of its per quisites in the sense that they have become an integral part of the ritual to be performed by the recipient as the office holder or are only shown to him as a mark of respect on the occasion of his visit to the temple. Having regard to the said principles, lot us now look at the contentions raised in this case. The first submission of learned counsel for the appellant is that, in view of the said principles, the suit should have been dismissed in limine on the basis of the allegations in the plaint. In paragraph 4 of the plaint in O. section No. 45 of 1945, the claim of the plaintiff to the office is stated thus: "The plaintiff is the present Emberumanar Jeer and as such the aradhanaikar and trustee of the said 67 526 Emberuraanar temple having been appointed and nominated by his predecessor Sri Sadagopa Ramanuja Jeer who died in 1930. " In paragraph 7 of the plaint, his claim to the honours is stated thus: "In his capacity as holder of the office of aradhanaikar and trustee of the Emberumanar temple and as emoluments attached to the said office, the Emberumanar Jeer is by immemorial usage and custom entitled to receive, in the ghoshties that are formed before all the sannidhies in the Adhinathalwar temple on all occasions of each day on all the days of the year without exception, the first theertham and other honours described in Schedule 1 below and the perquisites described in Schedule 11 below." In paragraph 9 it is further stated: "In his capacity as holder of the office of Aradhanalkar and trustee of Emberumanar temple and as emoluments attached to the said office the Emberumanar Jeer is entitled to receive on the 7th day of Vaikasi festival in the Athinathalwar temple, in addition to and along with the honours and perquisites described in Schedules 1 and 11, certain other honours such as the tying of the silk gear, etc., more particularly described in Schedule III hereto. These are known as special honours while the honours described in Schedules I and II are known as ordinary honours." It is clear from the said allegations that the claim of the plaintiff to the ordinary and special honours in the Athinathalwar temple is based upon his capacity as office holder as Aradhanaikar and trustee of Emberu manar temple. There is no allegation that he is an officeholder in Athinathalwar temple. In the written statements filed by the defendants the claim of the plaintiff to the said honours is denied. In O.S. No. 46 of 1945 also the claim of the plaintiff to the honours is based upon the same allegations that are made in the plaint in O. section No. 45 of 1945. In the written statement filed by the defendants the said claim is denied. Indeed, the original issues reflected 527 only the allegations found in the pleadings. If the courts had directed their minds to the pleadings, as they should have done, instead of traveling beyond them in search of some plausible basis to sustain the plaintiff 's claim the suits would have been dismissed for the simple reason that on the allegations in the plaint the plaintiff was not an office holder in the temple of Athinathalwar and, therefore, he ' could not claim the honours shown to him in the said temple as perquisites attached to his office; but unfortunately this was not done, and we think that it is too late to dismiss the suit on that ground when all the parties adduced voluminous evidence on the alternative ground and took the decision of the courts. We shall, therefore, pro ceed to consider the case on the alternative basis on which the claim has been put forward on behalf of the plaintiff in the courts below. To appreciate the said basis, it is necessary to re capitulate the relevant facts. Originally, the District Munsif dismissed the suit O. section No. 320 of 1933 (0. section No. 45 of 1945 on the file of the Court of the Subordinate Judge, Tuticorin) on the ground that the plaintiff has no legal right in respect of which he could seek relief in a civil court. But on appeal the learned Subordinate Judge set aside the decree and remanded the suit for trial. In paragraph 18 of his judgment, the learned Subordinate Judge stated: "In view of the above authorities I am of opinion that when the present plaintiff has come to Court with a specific case set out in paragraphs 7 and 9 of his plaint that his right of precedence to receive theertham, thulasi, satari, prasadam and other per quisites forms part of the emoluments of his office of aradanaikar in the suit temple, the suit cannot be dismissed on the preliminary ground that it is barred under Section 9, Civil Procedure Code. There is an obvious mistake in this statement, for in the paragraphs mentioned therein it is not alleged that the plaintiff has an office in the Athinathalwar temple." Presumably this mistake lead the learned Judge to come to the conclusion which he did. On appeal, in the High Court it was pointed out to the court that 528 temple. But Chandrasekara Aiyar, J., for the first time, allowed the plaintiff to make out a new case. The learned Judge stated the said case in the following words: "One view to take up in this case is what was adopted by the District Munsif, namely, that as the plaintiff admittedly holds no office in the Athinathalwar temple he cannot claim these honours. The other view which found favour with the Subordinate Judge is that owing to the alleged associations of the two temples, their interlinking and their interdependence, the Aradanaikar and trustee of the Emberumanar temple might claim to be regarded as an office holder in the Athinathalwar temple." The learned Judge did not decide the point, but he observed: "But the idea of two temples or Mutts, of equal rank and co ordinate and independent authority or where one is the primary institution and the other its subsidiary or adjunct being linked together for certain purposes of worship and observance of rituals cannot be said to be entirely foreign to Hindu notions." He concluded thus: "Of course, before he can succeed in the suit, the plaintiff has to make out that he being the Aradanaikar and trustee of the Emberumanar temple amounts to his holding an office in the suit temple." The question whether the origin of this new case is found in the judgment of the Subordinate Judge or that of Chandrasekara Aiyar, J., need not detain us. This is a new case not disclosed in the plaint; but after remand both the parties directed their attention to this question and adduced all the relevant evidence pertaining thereto. On remand, the learned Subordinate Judge in an elaborate judgment considered the said aspect of the case. He considered the evidence under three heads, namely, (i) historical, (ii) administrative, and (iii) financial. On the first head after considering the origin of the two temples, the learned Judge came to the 529 conclusion that the idea that the Emberumanar temple was historically connected with Athinathalwar temple could not be "poopoohed". Under the administrative head, he found that till 1926 Emberumanar temple was merely a sub shrine attached to the bigger Athinathalwar temple, and the trustees of the latter temple were exercising administrative control over it as such. Coming then to the financial side, he found that there was sufficient evidence to justify the inference that the two were intimately connected even financially. Passing on to the question of ceremonial and religious association between these two temples, the learned Judge found that there was similarity in the mode of routine and day to day worship in the two temples; but there was no interlinking or interdependence between them in that matter. Then the learned Subordinate Judge pointed out that notwithstanding that there was no interlinking and interdependence in that matter, they were so intimately associated with each other in other religious rites and ceremonies as to lead to the inference that the Emberumanar temple was after all only a sub shrine attached to the main temple of Athinathalwar. Then he pointed out that the question in the said form was not before Chandrasekara Aiyar, J., but thought that it was open to him to go into the said question. After going into the evidence, he finally came to the conclusion that apart from historical and secular association, there had been also ceremonial and religious association between the two temples and, therefore, the Emberumanar temple was nothing but a sub shrine attached to the main temple of Athinathalwar. On that finding he further held that the plaintiff who was admittedly the aradhanaikar of the said temple was virtually an office holder in the main temple. In the appeals filed by the various parties against the decrees of the learned Subordinate Judge, the learned District Judge of Tirunelveli reviewed the evidence once again under the said three heads and came to a contrary conclusion. On the administrative side he found that the Emberumanar temple was not subordinate to the 530 temple of Athinathalwar, in the sense that the authorities of the latter temple could give orders to the authorities of the Emberumanar temple, that is, the former was not subordinate to the latter temple administratively. On the financial side, he was equally emphatic that the two institutions were not interdependent. On the religious or ritual aspect, the learned District Judge held that, as both the institutions were constructed in the same place, there must have been some connection between the two and in that sense in a general way the Emberumanar temple might be described as a sub shrine. On the said facts, the learned Judge posed the following question for his consideration: "What is the inference to be derived? On the evidence, he answered the question thus: "I hold on the evidence that these institutions are not interdependent or intimately connected in such a way that an office holder of Emberumanar temple is necessarily an office holder of the Athi nathalwar temple. I hold therefore that the plaintiff is not an office holder of the Athinathalwar temple and therefore he is not entitled to file a suit with regard to his rights of precedence in being given theertham." This finding is certainly a finding of fact based upon the entire evidence in the case. In the second appeal, the learned Judge of the High Court, on a review of the evidence, disagreed with the learned District Judge and accepted the finding of the learned Subordinate Judge, and held, for similar reasons, that the plaintiff was virtually an office holder in the main temple; he further held that the plaintiff could also be considered to be the holder of the office of arulipad and, in that capacity also he was entitled to the first theertham and other honours. The first question is one of fact. The learned District Judge, though he differed from the Subordinate Judge, held, on a consideration of the entire evidence that the plaintiff was not an office holder in the Athinathalwar temple. It has now been well settled that the High Court has no jurisdiction to entertain a second appeal on the ground of erroneous finding of 531 fact however gross the error may seem to be. The judgment of the learned Judge does not disclose that there are any permissible grounds for interference with the finding of the District Judge. The second ground of decision of the High Court is based upon a case that was raised for the first time before it. Nowhere in the plaints or before the two subordinate courts the plaintiff attempted to sustain his claim on his being the holder of the office of arulipad. The High Court, therefore, was not justified in allowing the plaintiff to set out any such claim for the first time in the second appeal. That apart, it does not appear that there is an office called arulipad. A division bench of the Madras High Court in Vathiar Venkatachariar vs P. Ponnappa Ayyengar (1) had an occasion to define the word "arulipad". There, a claim was made to the office of Theerthakar. On the evidence it was held that the plaintiffs had not made out the existence of any obligatory duty on the part of Theerthakar in the temple. In that context Krishnan, J., observed thus: ". . . the Theerthakars have special places allotted to them in the temple, to stand and recite and they are given the honour of Thertham and Prasadam, before the outsiders get them; and they have what is called an "Arulipad", that is, their names are called out by the Archaka in a certain order, when, if present, they have to respond by saying 'Nayinde ', meaning 'I am here '." It is, therefore, clear that there is no office designated as " arulipad", but that word only describes the duty of the archaka to call their names to ascertain whether the theerthakars are present in the ghoshti. There is no evidence in this case that the plaintiff, as a theerthakar, has any obligatory duty in the Athinathalwar temple to perform and, therefore, it is not possible to treat him as an office holder in that capacity in the said temple. This leads us to the argument of the counsel for the respondent that, though it cannot be said that the Emberumanar temple is a part or a subordinate of the Athinathalwar temple in the sense that all the (1) 532 office holders of the former are the office holders of the latter, there is sufficient ritual connection between the two which in the consciousness of the religious public is treated as sufficiently intimate to make the one subordinate to the other. This intimate religious connection, the argument proceeds, flows from the historical, administrative and financial ties, however loose they may be, that have existed for over a century between the said two temples. This argument may have some validity in a theological discussion or an ecclesiastical court, but cannot obviously be accepted in a civil court. Krishnaswami Nayudu, J., sum marizes the facts in his judgment which, in his view, support the conclusion that the Emberumanar Jeer was virtually an office holder in the Athinathalwar temple. As the correctness of the said facts is not questioned before us, it will be convenient to extract them in the words of the learned Judge: "In all Vaishnavite temples, the Alwars and the Acharyas take a prominent place in the religious ceremonies and observances of the temple. An attempt was made to show that there has been an interlinking and interdependence of the ritual and ceremonies between these two temples, but, as rightly found by the learned Subordinate Judge, in the matter of routine and day to day worship and rituals such interlinking and interdependence have not been satisfactorily made out. The rituals or the manner of performing divine service are uniform in every Vaishnavite temple. But, as found by the learned Subordinate Judge, though a ritual in the main temple is not dependent upon the ritual in the sub shrine, the Emberumanar deity being an Acharya is intimately associated with the deity in the main temple in all the important festivals, the most important of which are the Margali and Vaikasi festivals and other religious ceremonies. There are several Mandagapadis for the Athinatha Alwar in the Emberumanar temple. There is Sethu Thirumanjam for the Athinatha Alwar and Embe rumanar deities on three occasions, two of them in the Emberumanar temple and one in the main 533 temple. Then there is what is called Alwar Sayanam which has to take place on the 10th day of the Margali festival and which is performed in the main temple. There are several other similar religious observances, where the two deities meet and certain rituals and religious ceremonies are gone through. The daily ritual in a Vaishnavite temple is a routine matter and on occasions, for instance, in the months of Margali and Vaikasi and on other festival days, there is necessity for the Alwars and the Acharyas to meet the main deity and ceremonies suitable to the occasions are performed. It is not possible to imagine a temple where God Vishnu is installed without the presence of the Alwars and Acharyas. Alwars and Acharyas are devotees of God Vishnu who have received divine recognition in their lives and the festivals in relation to them depict incidents of such manifestation of divine grace to his devotees. It may also be mentioned that the installation of each Emberumanar Jeer,, who it may be stated is a Sanyasi, is in the Athinatha Alwar temple under its Dwajasthamba, the flag staff, and the declaration of the status of the succeeding Jeer is made only ill the presence of the deity of the main temple. " We may also add to the said facts that at one time the share of tasdik allowance to the Emberumanar temple was paid through the trustee of Athinathalwar temple and there was also an occasion when a trustee of the Emberumanar temple was dismissed by the trustee of the Athinathalwar temple. On the other hand, both the temples are under different managements, they have their separate officeholders, distinct rituals, different budgets, and separate endowments; and in the year 1926 on an application filed by the Emberumanar Jeer, the Religious Endowments Board declared the temple as an excepted temple indicating thereby that the Emberumanar temple was a separate legal entity and that the said Jeer was its hereditary trustee. only question, therefore, is whether the said facts enable a court to 68 534 hold that one temple is subordinate or part of the other temple, so that the office holders of one temple would become the office holders of the other. The facts clearly establish that in fact and in law the two institutions are different legal entities. In the past, the trustees of Athinathalwar temple might have disbursed tasdik allowances contributed by the Government to the various temples, including the Emberumanar temple, but it is well known that for convenience of administration the services of the trustees of a larger temple were very often utilized by the Government in that regard; it might have been that sometimes the amounts payable to the smaller temples were allowed to lapse, but there is nothing on the record to show that it was not out of negligence of the trustees of the minor shrines in not making any pressing demands on the trustees of Athinathalwar temple; it might also have been that the trustee of the bigger temple, in his supervisory capacity, dismissed once in a way the trustee of a smaller shrine in the locality, but that could be explained by the paramount position of the trustee of the bigger temple in the locality compared to that of the minor temples. These and such acts may show that the trustee of the Athinathalwar temple had exercised similar supervisory control in the past over the minor temples; but that in itself does not make the trustee of the temple of Emberumanar an office holder in the bigger temple. It is well known that in the past the temples were under the supervision of the Revenue Board and later on under various temple committees. It cannot be suggested that on that account. the trustees of the minor temples were officers in the Revenue Board or the temple committees, as the case may be. We cannot also appreciate how the mutual visits of the idols to the other 's temple and the honours shown to the idols on such visits could have any bearing on the question to be decided, though they reflect the intimate relationship that exists between the Lord and his ardent devotee Ramanuja in the public consciousness. But such cordial relationship existing between two independent temples cannot in the eye of law make the 535 one a part of the other. Two independent institutions legally cannot, except in the manner known to law, be amalgamated into one institution by developing merely sentimental attachment between them. This argument was rightly rejected by the learned District Judge, and the High Court went wrong in accepting it. Before we close we must make it clear that by this judgment we have not in any way intended to express our view in the matter of honours that are customarily shown to one or other of the parties in these appeals in the temple of Athinathalwar. In the result we hold, agreeing with the District Judge, that the suits were not maintainable in the civil court. The appeals are, therefore, allowed with costs throughout. Appeals allowed.

The respondent as the aradanaikar and trustee of the Emberumanar temple, dedicated to Sri Ramanujacharya, which was one of the group of temples built around the main temple of Athinathalwar in the Tirunelveli District, brought the two suits, out of which present appeals arose, for declaration of his right to the first theertham and other honours and perquisites in precedence over all other worshippers in the temple of Athinathalwar and his case was that he was entitled to them by virtue of his office in the Emberumanar temple. The matters came up to the High Court. There was a remand order and the Subordinate Judge who tried the suits thereafter held that the Emberumanar temple was a sub shrine attached to the main temple and as such the plaintiff was virtually an office holder in the main temple and the precedence claimed by him was attached to that office as part of the remuneration and decreed the suits. On appeal the District judge, on a review of the entire evidence, set aside the findings arrived at by the trial court and dismissed the suits as not maintainable. The appeals to the High Court were heard by a single judge who, on a reconsideration of the evidence, reversed the findings of the District judge and affirmed those of the Subordinate judge and decreed the suits. It was, further, held by the High Court that, as one of the theerthakars, the appellant could be considered to be the holder of the office of arulipad in the main temple. Held, that although it was not permissible under section 9 of the Code of Civil Procedure for a civil Court to entertain a suit for a declaration of religious honours and privileges simpliciter, it could entertain a suit to establish one 's right to an office in a temple and to the honours and privileges attached to such office as its remuneration or perquisites. But the essential condition for the existence of an office was that its holder must be under a legal obligation to discharge the duties attached to it and be liable to penalty on failure to do so. So judged, there could neither be an independent office of theerthakar, for he had no obligatory duties to perform, nor that of an arulipad, since that word only connoted that the names of theerthakays were called out by the archaka in a particular order. 65 510 The question whether first theertham or any other honours shown to a person were merely as a mark of respect on the occasion of his visit to the temple, or were part of the remunera tion attached to his office, must in every case be decided on evidence and in the latter case such honours must be shown to have formed an integral part of the ritual to be performed by the recipient as the holder of the office. Athan Sadagopachariar Swamigal vs Elayavalli Srinivasa chariar, , approved. Striman Sadagopa vs Krishna Tatachariyar, (1863) 1 M.H.C.R. 301, Sri Rungachariar vs Rungasami Buttachar, (1909) I.L.R. and Vathiar Venkatachariar vs P. Ponappa Ayyangar, , referred to. Sri Emberumanar jeer Swamigal vs The Board of Commissioners for Hindu Religious Endowments, Madras, (1936) 71 M.L.J. 588, considered. Held, further, that it was well settled that the High Court bad no jurisdiction to entertain a second appeal on the ground of erroneous finding of fact, however gross the error might seem to be. In the instant case, the High Court was clearly in error in reversing the finding of the District judge, which was one of fact, that the Emberumanar temple was neither subordinate to, nore part of the Athinathalwar temple and no office holder of the former could, therefore, become an office holder of the latter.

No. 36 of 1960. Petition under article 32 of the Constitution of India for the enforcement of fundamental rights. N. C. Chatterjee, D. R. Prem, B. Ganapathy Iyer and G. Gopalakrishnan, for the petitioner. 412 B. Sen, R. H. Dhebar and T. M. Sen, for the respondents. April 26. The Judgment of Gajendragadkar, Wanchoo and Ayyangar, JJ., was delivered by Ayyangar, J., and that of Sarkar and Das Gupta, JJ., was delivered by Das Gupta, J. AYYANGAR, J. This is a petition, under article 32 of the Constitution praying for a writ, order or direction in the nature of certiorari calling for the records relating to the levy of customs duty and penalty on certain cycles and cycle parts imported by the petitioners, to quash the said order and for a direction to the respondents to restore and refund to the petitioners the customs duty and the penalties realised from them for releasing their goods. The Chief Controller of Imports and Exports, Pondicherry, The Collector of Customs, Pondicherry, The Central Board of Revenue, New Delhi, Chief Commissioner, Pondicherry and the Union of India have been made respondents to the petition. From the nature of the order sought and the array of the respondents it would be apparent that the matter involved in this petition is whether the respondents were justified in (a) levying customs duties on the goods imported by the petitioner and (b) imposing a penalty on them for effecting these imports. We shall now briefly narrate the facts necessary to understand the points arising for decision. The petitioners who are citizens of India placed an order on August 6, 1954, with certain firms in the United Kingdom for the despatch of cycles and cycle parts to Pondicherry which was at that date the principal French establishment in India. According to the law which then obtained in Pondicherry territory, merchants desiring to do business there had to have "a patent" or licence from the authorities for carrying on such business. The petitioners applied for such a "patent" to the authorities on August 14, 1954, and they were granted one on August 18, which was to be effective from August 1, 1954. The order placed with U. K. firms was accepted and the goods covered by the indents were shipped from the U. K. ports on 413 October 11, 1954. The foreign exchange needed for effecting this import could under the French Law have been obtained either from or on the authorization of the Head of the Department of Economic Affairs at Pondicherry or by what has been termed purchase in the open market. In pursuance of these facilities the moneys required were transmitted through bankers who made payments on behalf of the petitioners in the United Kingdom and the goods arrived in Pondicherry on December 4, 1954, the Bill of Entry being presented to the Customs Authorities for clearance on the 17th of that month. Meanwhile, political changes took place in the governance of Pondicherry and other French settlements. An agreement was entered into between the Governments of the Union of India and of France under which the administration of the French Settlements, including Pondicherry, was ceded to the Union Government. This agreement which was signed on behalf of the two Governments on October 21, 1954, was to be effective from November 1, 1954. On October 30, 1954, two notifications were issued by the Ministry of External Affairs in pursuance of the agreement dated October 21, 1954, between the two Governments. They were respectively S.R.O. 3314 and S.R.O. 3315. As the questions arising for decision in the petition turn on the proper construction and legal effect of these two notifications, it would be necessary to deal with them in some detail, but for the purpose of the narration of facts, it would be sufficient to say that while S.R.O. 3314 saved the operation of the pre existing French Law except in so far as it had been affected by S.R.O. 3315, the latter repealed such laws to the extent they were inconsistent with the Indian enactments set out in the Schedule whose operation was extended to Pondicherry and the French settlements. Among the Indian enactments so applied to Pondicherry were the Foreign Exchange Regulation Act, 1947, the Import and Export (Control) Act, 1947, the , and the Tariff Act, 1934. 53 414 The Bill of Entry was, as stated earlier, presented to the Customs Authorities at Pondicherry on December 17, 1954, and it would be seen that by that date Pondicherry was being administered as part of the Union territory with the Indian laws referred to operating in the area. The customs authorities at Pondicherry took the view that as the, consignment imported by the petitioners did not reach the port of Pondicherry before November 1, 1954, when the Union Government took over the territory, the importation was without authorization of the Indian law and therefore in contravention of the Import and Export Control Act and the Orders issued therein, the , the Tariff Act and the provisions of other relevant enactments. After a notice to the petitioners to show cause why the goods should not be treated as having been imported without a licence granted under the lmport and Export (Control) Act, the Customs authorities at Pondicherry after considering their explanation decided against the petitioners and directed them to clear the goods on payment of duty and of a penalty which was levied under section 167(8) of the . This order was passed on March 3, 1955. The petitioners thereupon preferred an appeal to the Central Board of Revenue who dismissed it by their order dated July 31, 1956, and thereafter the petitioners filed a revision to the Cen tral Government who dismissed it by their order dated January 8, 1957, but reduced the penalty imposed. It is in these circumstances that the petitioners have approached this Court for the reliefs set out at the beginning of this judgment. The following facts would emerge from the above narration: (1) that firm contracts had been entered into by the petitioners with the foreign sellers long before November 1, 1954 the date of the transfer of Pondicherry, (2) that the petitioners had the authorization of the French law by holding the "patent" granted to them on August 18, 1954, and effective from August 1, 1954, to carry on business in Pondicherry, (3) that the foreign exchange requirements for effecting the importation had been provided for by the 415 petitioners in a manner authorized by the French law, (4) the goods, however, arrived in Pondicherry after the date of the de facto transfer. In these circumstances the questions raised for decision are: (1) whether under the terms of the relevant notifications, to which we shall immediately refer, the importation was unauthorized for want of an import licence so as to render the petitioners subject to the levy of a penalty under section 167(8) of the , (2) whether the petitioners have a right under the relevant notifications to have the imported goods cleared from the Pondicherry port without the payment of the customs duty leviable under Indian law in the area from and after November 1, 1954. We have already referred to the two notifications by the External Affairs Ministry, the details of which we shall now proceed to state. By virtue of the jurisdiction obtained by the Union Government under the agreement between the two Governments dated October 21, 1954, S.R.O. 3314 was issued in exercise of the powers conferred by the , and came into force on November 1, 1954, when the agreement became effective. Its principal function was to provide for the continuance of the law which previously prevailed in Pondicherry except in so far as it was varied by other notifications issued by the Union Government extending Indian Laws to that territory. Paragraph 5 of section R.O. 3314 provided: "5. All laws in force in the French Establishments or any part thereof immediately before the commencement of this order and not repealed by paragraph 6 of the French Establishments (Application of Laws) Order, 1954, shall continue to be in force until repealed or amended by a competent autho rity. " The other provisions of this order are designed with the same objective, viz., the continuance of laws until other provisions are made by a competent Legislature or authority. The provisions contained in S.R.O. 3315 are of more immediate consequence for the purpose of this petition. Paragraph 3(1) of this order provided; 416 "The enactments specified in column 3 of the schedule as in force before the commencement of this order are hereby applied to, and shall be in force in the French Establishments subject to: (a). . . . . . . . . (b). . . . . . . . . (c) The subsequent provisions of the order. " Paragraph 6 which was in the nature of a saving clause ran: "Unless therefore specially provided in the schedule, all laws in force in the French Establishments immediately before the commencement of this order, which corresponds to the enactments specified in the schedule shall cease to have effect save as respects things done or omitted to be done before such commencement." Among the laws extended to Pondicherry under S.R.O. 3315 were, as already noticed, the , the , the Imports and Exports Trade (Control) Act, 1947, the Foreign Exchange Regulation Act, 1947, and the Indian Tariff Act, 1934. In the absence of the saving contained in the last words of paragraph 6 of S.R.O. 3315 "as respects things done or omitted to be done before such commencement", the previous French law or the authorizations or permits obtained thereunder, would have become repealed or exhausted and the import to be legal would have to be in conformity with the laws applied to the territory by virtue of paragraph 3 with the result that the orders of the Customs Authorities in the present case could not be open to challenge. The questions therefore are whether this saving protects the petitioners from: (a) the liability to the penalty, and (b) from payment of customs duty. We shall deal first with the levy of the penalty. This matter is wholly concluded in favour of the petitioner by the judgment of this Court in Universal Imports Agency vs The Chief Controller of Imports and Exports (1). There, as here, a contract had been entered into with a foreign supplier for the despatch of goods (1) ; 417 to the port of Pondicherry in the months preceding the transfer. The goods however arrived after November 1, 1954, and the customs authorities acting under the provisions of the , treated the import as unauthorized, and adjudged the goods to confiscation and also inflicted a fine. Petitions were then filed under article 32 for quashing these orders of confiscation and fine and for directing the return of the goods. It may be mentioned that the present petitioner was an intervener in the petitions then before this Court. This Court held that the words "things done" in paragraph 6 of S.R.O. 3315 were comprehensive so as to include a contract effected before November 1, 1954, though its legal effect and consequence projected into the post transfer period and the goods were imported only after November 1, 1954. The petitioners then before the Court having authority under the French law which prevailed before November 1, 1954, to import the goods and having placed the orders and effected the imports in pursuance of that law, this Court held that the imported goods could not, notwithstanding that they were actually brought into the territory after November 1, 1954, be confiscated on the ground that they were imported without a licence required under the Imports and Exports (Control) Act and the Sea Cus toms Act. Mr. Sen learned Counsel for the respondent urged some points of distinction between the facts in the Universal Imports Agency 's case( ') and the case now before us, but having examined them we find there is no substance in the argument. Learned Counsel submitted that in the present case the import was effected not by opening Letters of Credit but by payment by bankers ' draft and secondly, that the foreign exchange required for payment to the U. K. supplier was met in the present case by open market purchases and not by the purchase of foreign exchange from French Banking Establishments. In our opinion, these are wholly immaterial. Learned Counsel had to admit that there was no legal requirement to have a (1) ; 418 Letter of Credit and also that it was not in contravention of French law which prevailed before November 1, 1954, to obtain foreign exchange requirements by what are termed "open market purchases". In fact, in the case of the Universal Imports Agency( ') the orders impugned were passed and were sought to 'be supported before this Court on the ground that the foreign exchange requirements were met by "open market purchases" and that in consequence the importation was not authorized by the French law, and this contention was expressly negatived. We therefore hold that the petitioners are entitled to relief so far as the petition relates to the quashing of the order imposing the penalty and for a direction to refund the same. We now proceed to examine whether the claim of the petitioners that they are entitled to import the goods without payment of duty is justified by the saving contained in the last words of paragraph 6 of S.R.O. 3315. Mr. Chatterjee learned Counsel for the petitioners had to admit that this matter was not the subject of decision in Univeral Imports Agency '8 case (1). Nor is it a matter for surprise that it was not, because the petitioners then before this Court had never objected to the payment of the duty, and indeed the request they made to the Customs Authorities and which was rejected, which led to the petition, was that the authorisation which they had under the French law should be re validated by the Indian Customs Authorities so as to permit the importation on payment of normal duty as if the same were licensed under the Import and Export (Control) Order; and that on payment of the duty they were entitled to a customs clearance under sections 87 and 89 of the . This being the nature of the controversy raised in this Court, the petitioners relied on article 17 of the Articles of Agreement between the two Governments, to which we shall advert later, in support of their submission that while the Indian authorities were entitled to levy such customs duties as were fixed under law for the several articles imported, the import (1) ; 419 itself should be treated as authorised by the previous law whose operation was continued by the last words of cl. 6 of S.R.O. 3315 of 1954. Further, as we shall presently show, there are passages in the judgment of Subba Rao, J., who spoke for the majority, that on an importation effected after November 1, 1954, customs duty would have to be paid according to the rates fixed under the relevant Indian legislation. The submission of Mr. Chatterji however was that this relief which he claimed followed logically from the reasoning of Subba Rao, J., and in particular he relied on the following passage: ". . A purchase by import involved a series of integrated activities commencing from the contract of purchase with a foreign firm and ending with the bringing of the goods into the importing country and the purchase and resultant import formed parts of a same transaction. If so, in the present case the bringing of the goods into India and the relevant contracts entered into by the petitioners, with the foreign dealers formed parts of the same transaction. The imports, therefore, were the effect or the legal consequence of the 'things done ', i. e., the contracts entered into by the petitioners with the foreign dealers before merger. " The argument of the learned counsel based on this passage was on the following lines: This Court has held that it is the agreement concluded with the foreign seller under which goods are contracted to be imported, which constituted the "thing done". The legal consequence of that "thing done" was the act of importation, because that was the object and purpose of the contract, so far as the buyer was concerned. This Court has held that the previous authorization by the French law, as it were, projected into the post transfer period so as to justify the importer claiming that the importation was authorized and this is the ratio of the decision. But this does not, learned counsel urged, exhaust the entirety of the rights of the importer. The previous French law authorized the import into a territory which was "a free port". When therefore the importation was made by virtue 420 of the authorization contained in the previous law, its effect should extend not merely to justify the claim to have the import treated as one authorized under the relevant Indian law, but logically also as entitling the party to effect the importation without payment of customs duty. We find ourselves unable to accept this argument. The expression "free port" in the case of Pondicherry merely meant freedom from restriction as to importation in the shape of licence, etc., and not a complete absence of duties leviable on importation. But that apart, if the submission of the learned counsel amounted to saying that the point about the exemption of the petitioner from payment of customs duty is also covered by the decision of this Court in Universal Imports Agency 's case (1), we consider it wholly unjustified. As we have already shown, the liability to pay customs duty was admitted by the petitioner and the reasoning by which he sought relief in this Court proceeded on the basis that such duties were exigible. Besides, the entire reasoning of Subba Rao, J., was directed to show that the authorization under the French law to effect the import should be held to protect the petitioners then before the Court from being treated as having imported goods without a licence under the Import and Export (Control) Act, and that is why in the penultimate paragraph of the order the conclusion reached is thus set down: "We would therefore hold that paragraph 6 of the order saves the transaction entered into by the petitioners and that the respondents had no rights to confiscate their goods on the ground that they were imported without licence. " It is in this context that the observations extracted earlier on which Mr. Chatterji relies have to be understood. Besides, there are passages in the judgment which expressly refer to the fact that goods imported after November 1, 1954, would be liable to be charged duty under the relevant Indian fiscal statute. In making this observation we have in mind the reference by the learned Judge to the Notification (1) ; 421 of the Central Government dated November 1, 1954, and to the terms of article 17 of the Articles of Agreement dated October 21, 1954, between the two Governments (to both of which we shall advert later). The decision of this Court is not, therefore, an authority to support the petitioner on the point regarding the right to import without payment of duty and we have to deal with the matter on the footing that it is res integra. Nor can the plea based on the logic of the ratio of the decision in the Universal Imports Agency 's case (1) assist Mr. Chatterji to any material extent, because the content of the saving as respects "things done", must ultimately be determined not by any interpretation of these two words in vacuo, but in the context of the entire scheme of the two section R. Os. read in the light of other material which could assist in arriving at their scope. Thus, for instance, if S.R.O. 3315 contained a specific proviso excepting from the saving as regards ' things done" the obligation, say, to pay duties of customs, it could hardly be contended that as the imports under pre transfer contracts should be deemed to be authorised even if the goods arrive subsequent thereto, they should be exempt from the payment of duty. No doubt there is no such express provision but such a situation can also arise by necessary intendment. The right to exemption from payment of duty claimed by the petitioners would therefore have to depend on the proper interpretation of the relevant notifications, because as already seen as the and the Tariff Act, etc., having been extended to Pondicherry territory, etc., from and after November 1, 1954, prima facie duty would be payable on the import. We have already pointed out the inter relation between S.R.O. 3314 and 3315 which were issued on the same date and by virtue of the same provisions and power. Paragraph 6 of S.R.O. 3314 which provided for the continuance of the previous existing laws ran: (1) ; 54 422 "All taxes, duties, cesses or fees which, immediately before the commencement of this order were being lawfully levied in the French Establishments or any part thereof shall, in so far as such levy has not been discontinued by any of the laws extended to the French Establishments by the French Establishments (Application of Laws) Order, 1954, continue to be levied and applied for the same purpose until other provisions are made by a competent Legislature or authority". This would be some indication that taxes, duties, cesses and fees imposed by reason of the extension to that territory, of Indian laws under the French Establishments (Application of Laws) Order, 1954, (S.R.O. 3315) would be operative from and after November 1, 1954. On November 1, 1954, the Government of India appointed a Controller of Imports and Exports for the French Establishments and paragraph 4 of that notification also contained the following: " As regards orders placed outside the Establishments and finalised through the grant of licence by the competent French Authorities in accordance with the Laws and Regulations in force prior to 1st November, 1954, licence holders are advised to apply to the Controller of Imports and Exports for validation of licences held by them. No fees will be charged for these applications". This notification, though it has no statutory force, was obviously part and parcel of S.R.O. 3314 and 3315, in so far as these related to the administration of the Import and Export (Control) Act, the and the Tariff Act and would therefore throw considerable light on what was intended by the framers of S.R.O. 3315. The effect of this notification was that the authorization granted by or the permission acquired from the French authorities was made to serve the same purpose as the grant of a licence to import under the Import and Export (Control) Act and nothing more. If its effect was in terms confined to this, there could be no contention that goods imported in pursuance of the authorization should be exempted from customs duty. 423 Besides this, we might also draw attention to paragraph 17 of the Articles of Agreement dated October 21, 1954, under the terms of which the transfer of Pondicherry to the Union Government was effected. No doubt, that was an agreement between two Governments whose terms and covenants are not justiciable in municipal courts but as the two S.R.0s. themselves proceed on the basis of this agreement and have been issued by virtue of the authority acquired by the Union Government under the Agreement, a reference to the terms thereof would be pertinent for understanding the scope or intent of the provisions in these two orders S.R.O. 3314 and 3315. Paragraph 17 of the Agreement dated October 21, 1954 which has been referred to also by Subba Rao, J., in the Universal lmports Agency 's case (1) in support of the position that the authorization under the French law to effect importation of goods into Pondicherry was tanta mount to and had the same effect as the obtaining of a licence under the Import and Export (Control) Act, 1947 expressly made provision for the Government of India applying to the Establishment the relevant Indian laws relating to the imposition of customs and other duties in respect of goods which entered the port after November 1, 1954. It reads: " All orders placed outside the Establishments and finalised through the grant of a Licence by competent authorities in accordance with the laws and regulations in force, prior to the date of the de facto transfer, shall be fulfilled and the necessary foreign currency granted, as far as the goods are imported within the period of validity of the relevant Licence. The goods shall, however, be liable to customs duty and other taxes normally leviable at Indian ports. . . . . As we have already pointed out, this is exactly what is sought to be achieved by the conjoint operation of paragraph 6 of S.R.O. 3314 and the extension of fiscal laws to Pondicherry effected by paragraph 3 of S.R.O. 3315. It is precisely this that is also brought out by paragraph 4 of the notification dated November 1, 1954, extracted earlier. In the circumstances (1) ; 424 it looks somewhat curious that the petitioners now before us, who as interveners in the petitions by the Universal Imports Agency, etc., supported the invoking of para. 6 of S.R.O. 3314, or article 17 of the Articles of Agreement and para. 4 of the notification dated November 1, 1954, as an aid to the construction of the words "things done" in para. 6 of S.R.O. 3315 the Government resisting their use as an aid, should now take up the position that these materials are irrelevant for determining the scope of those crucial words. In our opinion the petitioners are not entitled to have their goods imported into Pondicherry after November 1, 1954, without payment of duty notwithstanding that the contracts, by reason of which the goods were imported, were entered into or the shipment took place before that date. The result is that the petition is allowed and the orders of the Government, of the Central Board of Revenue and the Collector of Customs are quashed only in so far as they impose a penalty on the petitioner for importing goods without a licence under the Import and Export (Control) Act, 1947, and the Import Control Order. The respondents were entitled to demand and to enforce the payment of customs duty and the relief prayed in the petition in so far as it relates to the quashing of the order in that respect and the refund of the duty collected, fails and is rejected. In the circumstances there would be no order as to costs. DAS GUPTA, J. We agree that in view of this Court 's decision in M/s. Universal Imports Agency vs The Chief Controller of Imports and Exports (1) the petitioners are entitled to relief as against the order imposing penalty for importation of goods into Pondicherry, even though the actual importation took place, after November 1, 1954, as the contract in pursuance of which the importation took place had been concluded prior to that date. We are not able to agree however that the position is different as regards the (1) [1061] 1 S.C.R. 305. 425 petitioners ' prayer for relief against the levy of customs duty on this very importation. With great respect to our learned brethren, who have taken the contrary view, we are of opinion that as long as the Universal Imports Agency case (1) is not held to have been wrongly decided, we are bound by the authority of that decision to hold that the petitioners are entitled to relief against the levy of customs duty as well. In all the three petitions which were before the Court in the Universal Imports Agency Case, the petitioners had entered into firm contracts of purchase by import with foreign sellers, before the date of merger of Pondicherry with India; in all the cases, the goods reached the destination, the port of Pondicherry, after the date of merger. By that date (which was November 1, 1954) however the entire administration of Pondicherry had become vested in the Government of India, but Pondicherry still remained a foreign territory. Under section 4 of the , an order had been made on October 30, 1954, being notification S.R.O. 3315, in consequence of which the Import and Export (Control) Act, 1947, and the , along with several other Indian statutes became laws in force in Pondicherry. 6 of this order was in these words: "Unless otherwise specifically provided in the Schedule, all laws in force in the French Establishments immediately before the commencement of this order which corresponds to the enactments specified in the Schedule shall cease to have effect, save as respects things done or omitted to be done before such commencement. " When the goods arrived at the Port of Pondicherry they were confiscated, on the ground that they had been imported without licence. But an option was given to pay a penalty in lieu of confiscation. The petitioners paid the penalty and then came to this Court for relief In making the order of confiscation and giving an option to the petitioners to pay penalty in lieu of confiscation the Collector of Customs proceeded on the (1) ; 426 basis of section 3(2) of the Imports and Exports Trade (Control) Act read with section 67(8) of the . The ground on which relief was sought from this Court was that to this act of importation, the Indian statutes mentioned in notification S.R.O. 3315 did not apply because this was "a thing done" before the commencement of the order. If this contention succeeded, there was no escape from the conclusion that the order of confiscation had no legal basis, for the laws in force in the French Establishments regarding the importation of goods into Pondicherry did not require such licence. The controversy before the Court therefore was whether the import was or was not "a thing done" within the meaning of the saving provisions of para. 6 of the order. On the one hand, it was urged that only the conclusion of the contract was "a thing done" before the commencement of the order and the importation the bringing of the goods across the customs barrier at Pondicherry port which was the mere consequence of the contract could not, without undue strain on the language, be said to be a thing done before the commencement of the order. Against this it was urged on behalf of the petitioners that the words "things done" included not only the things actually done and completed, but also their consequence. The majority decision of this Court accepted the petitioners ' contention and also held that an import was the legal consequence of the contract that had been entered into by the petitioners with the foreign dealers and so where the contract was concluded before the date of commencement of the order, the import by bringing the goods into Pondicherry Port was also a "thing done" before the commencement of the order. It is helpful in this connection to reread what was said by our brother Subba Rao, J., speaking for the majority. After setting out the relevant facts he proceeded to say: "On the said facts a short question arises whether paragraph 6 of the Order protects the petitioners. While learned counsel for the petitioners contends that "things done" take in not only things done but also their legal consequences, learned 427 counsel for the State contends that, as the goods were not brought into India before the merger, it was not a thing done before the merger, and therefore, would be governed by the enactments specified in the Schedule. It is not necessary to consider in this case whether the concept of import not only( takes in the factual bringing, of goods into India, but also the entire process of Import commencing from the date of the application for permission to import and ending with the crossing of the customs barrier in India. The words "things done" in para. 6 must be reasonably interpreted and, if so interpreted they can mean not only things done but also the legal consequences flowing therefrom. If the interpretation suggested by the learned counsel for the respondents be accepted, the saving clause would become unnecessary. If what it saves, is only the executed contracts, i.e., the contracts where under the goods have been imported and received by the buyer before the merger, no further protection is necessary as ordinarily no question of enforcement of the contracts under the preexisting law would arise. " After pointing out that the phraseology used had been copied from various previous statutes and referring to several English decisions as regards the interpretation of the words "things done" the conclusion of the majority was stated in these words: "We therefore hold that the words "things done" in paragraph 6 of the, Order are comprehensive enough to take in a transaction effected before the merger, though some of its legal effects and consequences projected into the post merger period. " The question whether imports were the conse quences of the contract that had been entered into before the date of merger was next examined even though this position does not appear to have been seriously disputed, and the conclusion was stated thus: ". . It may be stated that a purchase by import involves a series of integrated activities commencing from the contract of purchase with a foreign firm and ending with the bringing of the goods 428 into the importing country and that the purchase and resultant import form parts of the same transaction. If so, in the present case the bringing of the goods into India and the relevant contracts entered into by the petitioners with the foreign dealers form parts of the same transaction. The imports, therefore, were the effect or the legal con sequences of the "things done", i.e., the contracts entered into by the petitioners with the foreign dealers. " Applying the principles of law thus enunciated the majority held that para. 6 of the order saved the transactions entered into by the petitioners and that the respondent had no right to confiscate their goods on the ground that they were imported without licence. Accordingly it gave the petitioners the relief they sought for. In the present case also the question is whether the act of importation can get the benefit of the saving provisions in para. 6 of the order. We cannot see how that benefit can be denied in respect of customs duty, unless we refuse to apply the principles laid down in the Universal Imports Agency case; and we cannot see how we can refuse to apply these principles. It is true that in that case the Court had not to deal with the question of customs duty. The questions for decision were however pure questions of law: (i) whether the imports were the effect or the legal consequence of the "things done", i.e., the contracts entered into by the Indian buyers with foreign dealers and (ii) whether "things done" mean not only things done but also the legal consequences flowing therefrom. Whether these questions of law fell to be decided in a case, where the benefit of the saving clause is sought against an order of confiscation or as in the present case it is sought against an order for payment of customs duty is wholly irrelevant for the decisions of these questions of law. We wish to make it clear that we have no opinion to express as regards the decisions of these questions of law by the majority in the Universal Imports Agency case. What we cannot ignore is that the law laid down by the majority on 429 those questions in that case is law and should be followed by this Court as it has to be followed by other courts, the only difference being that this Court can overrule those decisions. But so long as that is not done the law as laid down there is good law, which we in deciding the present case must obey. Applying c. that law we are of opinion that we are bound to hold that the provisions in the for levy of customs duty on imports of the goods which were imported by the petitioners in the present case do not apply to these imports unless there is something in the order itself which deprives the act of importation from the benefit of the saving clause in respect of the customs duty. No such thing can be seen in the order. Of the 6 paras of which it consists the first merely gives its name and says that it will come into force on the 1st day of November, 1954. The second para. defines the French Establishments. The third para. which is the operative para. says that the enactments specified in col. 3 of the Schedule as in force before the commencement of this order are hereby applied to, and shall be in force in French Establishments subject to (a) amendments, (b) modifications, if any, specified in column 4 of the Schedule and (c) the subsequent provisions of the order. 4 contains a rule of construction, viz., reference in any enactment, notification, rule, order or regulation. applied to the French Establishments by this order, to India or to States or State generally shall be construed as including a reference to the French Establishments; and some other similar provisions. 5 empowers the court, tribunal or authority required or empowered to enforce any specified enactment, in the French Establishments, to construe the enactment with such alte rations, not affecting the substance as may be necessary or proper. 6 which has already been set out contains the saving clause. It is worth noting that the provisions for the application of the enactments to the French Establishments is in terms made subject to subsequent provisions of the order and thus clearly to the provisions of para. There is thus 55 430 nothing in the order itself, which makes the saving provision in para. 6 inapplicable to the levy of customs duties. Nor has our attention been drawn to any later law which would have the effect of depriving the petitioners from the benefit of those saving clauses. On behalf of the State reference was made to para. 17 of the Articles of Indo French Agreement. After stating that all orders placed outside the Establishments and finalised through the grant of a licence by competent authorities shall be fulfilled and the necessary foreign currency granted, so far as the goods are imported within the period of the validity of the relevant licence, goes on to say, the goods shall however be liable to customs duty and other taxes normally leviable at Indian ports. It is argued that this expression of intention by the Government of India as mentioned in this Agreement to realise customs duty on goods imported after the merger should be taken into consideration in applying the saving provisions of the order in notification section R. O. 3315. We are unable to persuade ourselves that there is any justification in reading into the order section R. O. 3315 anything to the contrary that might have been expressed in the Indo French Agreement. It is true that the provisions of this para. of the Indo French Agreement were referred to in the majority judgment in the Universal Imports Agency case and it was said that the conclusion already reached were reinforced by what appeared in para. It is one thing however for a court to consider that conclusions reached on legal principles is in keeping with the intention expressed in a document between high contracting parties, it is quite another thing to say that the conclusion reached on legal principles should be departed from because it seems to be at variance with what has been said in such a document. In view of what was agreed to in para. 17 of the Indo French Agreement there would have been no difficulty for the Government of India to make provision when providing for the saving of the operation of certain laws to be applied to the French Establishments in respect of "things done" 431 before the commencement of the order to exempt the levy of customs duty from such saving. That was not done. There is nothing in law that we are aware of which would compel the Government of India because of the above Agreement in para. 17 to extend the provisions of levy of customs duty in the in respect of things done before the com mencement of the order. Though the Government of India could have well made the exception when inserting the saving clause in the order section R. O. 3315 in respect of levy of customs duty they did not do so. It will be improper in our opinion to hold that even though the Government of India did not expect it we should do so to give effect to what is considered to be the Government of India 's intention as expressed in the Indo French Agreement. Reference has also been made to another order made by the Government of India, i.e., section R. O. 3314 which saved the operation of the preexisting French law except in so far as it had been affected by section R. O. 3315. Paragraph 5 of this order provides that all laws in force in the French Establishments immediately before the commencement of the order and not repealed by paragraph 6 of the French Establishments (Application of Laws Order) 1954 that is the order in section R. O. 3315 shall continue to be in force until repealed or amended by competent authority. 6 of the same order (section R. O. 3314) provides that all taxes, duties, cesses or fees which immediately before the commencement of the order were being lawfully levied in the French Establishments in so far as such levy has not been discontinued by any of the laws extended to the French Establishment by the French Establishments (Application of Laws Order) 1954 continued to be levied. Thus if any customs duty had been pay. able under the French law which was in force prior to November 1, 1954, that would have continued to be payable in respect of "things done" which are saved from the operation of the Indian laws in the matter by para. 6 of section R. O. 3315. We are unable to see how either of these provisions in S.R.O. 3314 or anything else therein can deprive 432 the petitioners from the benefit of the saving clause in para. 6 of the French Establishments (Application of Laws Order) 1954, in respect of the levy of customs duty. What is it that is saved by this saving provision in para. 6? It is the things done before the commencement of the order. If the thing done did not include the bringing of the goods across the customs barrier, it would not have been saved. It was held in the Universal Imports Agency case that bringing the goods across the customs barrier was a "thing done" before the commencement of the order when the contract in pursuance of which this was done, was concluded before the date of commencement of the order. Under the saving clause in para. 6, this "thing done" i.e., the bringing the goods across the customs barrier is saved from a body of Indian laws and is intended to be controlled by a corresponding body of the previously prevailing French laws. It is not possible without reading into para. 6, some words like"provided that in respect of levy of customs duty under the , the corresponding French law will cease to have effect, if the actual import takes place after the commencement of the order" to hold that the levy of customs duty will be governed by the Indian law, in respect even of an import which was a "thing done" before the commencement of the order. We are of opinion that on the law as laid down in the Universal Imports Agency case the importation of goods in the present case in pursuance of a contract which was concluded before the date of the commencement of the order (S.R.O. 3315) was governed by the French laws and not by the Indian laws, no less as regards the question of levy of customs duty than as regards the question of import licences. Under the French law no duty was payable on these imports. Consequently these petitioners were not liable to pay duty on these imports. In our opinion, the petitioners are entitled to the relief they have prayed for, both against the levy of 433 customs duty and against the order imposing penalty for importation without licence. We would accordingly allow the petition. By COURT. In accordance with the opinion of the majority, the petition is allowed in part and the orders of the Government in so far as they impose a penalty on the petitioners for importing goods without a licence, are set aside; except to this extent, the petition shall stand dismissed.

The petitioners entered into agreements with certain British firms for the import of cycles and cycle parts to Pondi cherry, which was then a French Establishment, in the manner provided by French law. The goods arrived at Pondicherry after the French Establishments had merged into India on the basis of the Agreement dated October 21, 1954, between the Union of India and France, which was to be operative from November 1, 1954. By virtue of the said Agreement two Orders, dated October 30, 1954, were issued by the Ministry of External Affairs under the Foreign jurisdiction Act, 1947, being S.R.O. 3314, the French Establishments (Administration) Order, 1954, and S.R.O. 3315, the French Establishments (Application of Laws) Order, 1954. The first saved the operation of the preexisting French Law except in so far as it was repealed by the second, which extended to French Settlements certain Indian Statutes specified in the Schedule and amongst these were the , the Tariff Act, 1934, the Import and Export (Control) Act, 1947, and the Foreign Exchange Regulation Act, 1947. These Orders came into force on November 1, 1954. On the same day the Government of India, by a Notification, appointed a Controller of Imports and Exports for the French Settlements. Paragraph 4 Of this notification called upon the licence holders under the French Law to apply to the Controller for validation of the licences held by them. Paragraph 17 Of the Agreement, while saving import of goods validly ordered prior to the de facto transfer, made such goods liable to customs duty. As the goods arrived at Pondicherry on December 4, 1954, the Customs Authorities took the view that the import was in contravention of the Indian Statutes and ordered the petitioners to pay a penalty under section i67(8) of the , as also customs duty. The Central Board of Revenue on appeal upheld the order and the Central Government in revision, while affirming that decision, reduced the penalty. Paragraph 6 of S.R.O. 3315 provided as follows, 411 " Unless therefore specially provided in the schedule all laws in force in the French Establishments immediately before the commencement of this order which correspond to the enactments specified in the schedule shall cease to have effect, save as respects things done or omitted to be done before such commencement". The question for determination was whether the petitioners were liable to pay the penalty under section i67(8) of the , and also the Customs Duty. Held, (per curiam), that in view of, the decision of this Court in Universal Imports Agency vs The Chief Controller of Imports and Exports, the petitioners were not liable to pay the penalty under section i67(8) of the . Universal Imports Agency vs The Chief Controller of Imports and Exports, ; , followed. Per Gajendragadkar, Wanchoo and Ayyangar, JJ. That decision of this Court, however, did not apply to or absolve the petitioners from the liability to pay the customs duty. In order to determine the exact scope of the words "things done" occurring in para. 6 of S.R.O. 3315, the two orders, S.R.O. 3314 and S.R.O. 3315 must be read along with para. 17 of the Agreement and para. 4 Of the Notification of November 1, 1954, appointing the Controller and so determined there could be no doubt that the saving clause afforded no protection to the petitioners so far as their liability to pay the customs duty was concerned. Per Sarkar and Das Gupta, JJ. The words "things done" occurring in para. 6 of S.R.O. 3315 as construed by this Court in Universal Imports Agency vs The Chief Controller of Imports and Exports, cover the petitioners ' liability to pay not only the penalty but also the customs duty and so long as that decision stands, it has to be followed. Universal Imports Agency vs The Chief Controller of Imports and Exports, ; , discussed. There is nothing in the Order S.R.O. 3315 itself which renders the saving provision in para. 6 inapplicable to the levy of customs duty nor does any later law deprive the petitioners of its protection. There can be no justification for reading into the Order S.R.O. 3315 anything to the contrary contained in para. 17 of the Articles of the Indo French Agreement.

Appeal No. 43 of 1958. Appeal by special leave from the judgment and order dated April 11, 1956, of the former PEPSU High Court in Civil Misc. Case No. 173 of 1955. Naunit Lal, for the appellants. section M. Sikhri, Advocate General, Punjab, Gopal Singh and D. Gupta, for the respondents. 504 1961. April 27. The Judgment of the Court was delivered by DAB GUPTA, J. The 51 appellants all of whom belong to village Simla, Tehsil, Narwana, filed in the Pepsu High Court at Patiala a petition under article 226 and article 227 of the Constitution for relief against an order made by the Divisional Canal Commissioner, Narwana, for payment of certain water rates and Tawan. It appears that on the night of September 1, 1951, there was a cut on the left bank of Sirsa Branch Canal. Certain persons were prosecuted on a charge for having damaged the Canal but they were acquitted. Thereafter, the Divisional Canal Officer, Narwana, on the recommendation of the Sub Divisional Officer, Canal, Narwana made an order levying special charges against these appellants. On appeal the Divisional Canal Officer, Narwana, ordered in partial modification of the order made by the Sub Divisional Officer, the levy of six times the crop rates on cultivated area and six times the charges on uncultivated area and single bulk rate on water store of village Simla. This levy was made on the basis of his conclusion that the villagers of Simla were responsible for the cut and joined hands for the common good. The High Court dismissed the application by a short order stating that the points involved in this petition were fully covered by the decision of a Division Bench of the same High Court in Mukandi Ram vs The Executive Engineer (LPA/FAO No. 58 of 1954) and that the counsel for the petitioners had therefore nothing to say in support of the petition and did not press it. Against this order of dismissal the present petition has been filed by special leave obtained from this Court. Before mentioning the points raised by Mr. Naunit Lal in support of the appeal it would be convenient to refer to the provisions of law that require consideration. Section 31 of the , which admittedly applies to the Sirsa Branch Canal provides for the levy of water rates for 505 supply of canal water taken in the absence of contract at the rates and subject to the condition prescribed by the rules to be made by the State Government in respect thereof. No rules have however been made as regards the rates to be charged for such unauthorised supply of canal water in respect of the Sirsa Branch Canal which was in the State of Patiala. Rules had however been made by the 'Punjab Government in respect of the Sirhind Canal and branches thereof as also the Western Jumna Canal and branches thereof as early as April 1873 and August 1878 respectively. These rules had been amended from time to time. At the time the Sub Divisional Officer made his recommendation and the Divisional Canal Officer made his order these rules had not been extended to the Pepsu. It was when the appeal was pending before the Commissioner that the Pepsu Sirhind Canal and Western Jumna Canal Rules (Enforcement and Validation) Act No. IV of 1954 was passed by the Pepsu State Legislature. Section 3 of this Act applied with retrospective effect from August 1, 1948, the Sirhind Canal Rules and the Western Jumna Canal Rules to the Pepsu State. Section 4 provided that as from August 1, 1948, anything done or any action taken in accordance with the Pepsu Sirhind Canal Rules or the Western Jumna Canal Rules shall not be called in question in any proceedings before any court or other authority merely on the ground that the Sirhind Canal Rules or the Western Jumna Canal Rules were not in force in the Pepsu State on the date on which such thing was done or such action was taken. It may be mentioned that this Act replaced the Pepsu Sirhind Canal and Western Jumna Canal Rules (Enforcement and Validation) Ordinance, 1954, which had been made shortly before this. In Mukandi Ram vs The Executive Engineer (1), on the basis of which without further discussion the petition in this case was dismissed the Pepsu High Court held on facts practically identical with the facts of this case that the levy of special rates by the Canal Commissioner was justified under Rule 32 and in any case (1) LPA/FAO No. 58 of 1954. 506 under Rule 33 of the Sirhind Canal Rules read with section 31 of the Act. The main contention raised by Mr. Naunit Lal before us in support of the present appeal is that section 3 and section 4 of the Pepsu Sirhind Canal and Western Jumna Canal Rules (Enforcement and Validation) Act No. IV of 1954 are unconstitutional being in contravention of article 20(1) of the Constitution. Other points that he wanted to urge were (i) that the provisions of Rules 32 and 33 do not apply to the facts of the present case and (ii) that the notice served before the levy was made was not sufficient. As however it appeared clear to us that neither of these points was taken before the High Court we have not given him permission to raise these points before us, in the circumstances of this case. Another point that Rules 32 and 33 are beyond the scope of the rule making provisions of the Act was mentioned by the learned counsel but was later abandoned. The only point for our consideration therefore is whether section 3 and section 4 of the Pepsu Sirhind Canal and Western Jumna Canal Rules (Enforcement and Validation) Act, 1954, infringes the provisions of article 20(1) of the Constitution. article 20(1) provides that no person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence, nor be subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence. It is argued on behalf of the appellants that the application by these sections of rules allowing the imposition of special rates which have been imposed under the provisions of Rules 32 and 33 of the Pepsu Sirhind Canal Rules, which could not have been imposed at the time the water was used is bad, as thereby the appellants have been subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence. This argument is based on the assumption that the use of water by the appellants was an "offence" and 507 that the imposition of an enhanced water charge under Rules 32 and 33 read with section 31 of the Canal Act for such use was "a penalty" for such an "offence". This assumption is clearly wrong. "Offence" s as was pointed out by this Court in Maqbool Hussain 's case (1) where article 20(2) of the Constitution came up for consideration has not been defined in the Constitution. So under article 367 which provides that the , shall apply for the interpretation of the Constitution the word "offence" in the several clauses of article 20 must be understood to convey the meaning given to it in section 3(37) of the . That section defines an "offence" to mean an act or omission made punishable by any law for the time being in force. Punishment is the mode by which the State enforces its laws forbidding the doing of something, or omission to do something. Punishment may take different forms. It may be a mere reprimand; it may be a fine; it may be whipping; it may be imprisonment simple or rigorous; it may even extend to death. But whatever the form, punishment is always co related to a law of the State forbidding the doing or the omission to do something. Unless such a law exists, there is no question of any act or omission being made " punish able". Have we in the present case any law forbidding the unauthorised user of the water which section 31 of the Canal Act provides will be charged at rates that may be prescribed by rules? Quite clearly, there is none. In providing for a charge to be made for use of water at rates that may be prescribed by rules the legislature is not prohibiting the use of water. The word "unauthorised use" in the section does not import any idea of prohibition. The intention of the law clearly is to obtain payment for water used; and the fact that the rates prescribed may be high cannot alter this position. We are therefore of opinion that the use of the water by the petitioners was not an "offence" and the order for levy of special rates for user thereof was not (1) ; 508 the imposition of a penalty for an offence. When the Sub Divisional Canal Officer or the Canal Commissioner was dealing with the matter they had to decide whether these petitioners had used water in an unauthorised manner and if so at what rates they should be charged for such use. In doing this, they were not trying anybody for any offence; and the fact that special rates were imposed did not deprive these rates of their essential character of a charge for water used and did not convert them into any penalty for the commission of an offence. There is therefore no scope here for the application of the provisions of article 20(1) of the Constitution. The appeal is accordingly dismissed with costs. Appeal dismissed.

Certain persons were prosecuted but acquitted of a charge of having damaged a canal. Thereafter the canal officers levied special canal charges on the appellants on the basis of the conclusion that the villagers were responsible for a cut in the canal. The High Court is missed the appellants petition under articles 226 and 227 of the Constitution on the ground that the case was covered by the case of Mukundi Ram vs The Executive Engineer, decided by the High Court (LPA/FAO NO. 58 of 1954), On appeal by special leave the appellants contended that sections 3, and 4 Of the Pepsu Sirhind Canal and Western jamuna Canal Rules (Enforcement and validation) Act (No. IV of 1954) are unconstitutional being in contravention of article 20(1) of the Constitution inasmuch as they have been subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence. Held, that the use of water by the appellants was not an "offence" and the levy of special rates under Rules 32 and 33 of the Sirhind Canal Rules read with section 31 of the Northern India Canal and Drainage Act, i873, for such use was not the imposition of a "penalty" for an offence as contemplated under article 20(1) of the Constitution. Maqbool Hussain 's case; , , referred to.

Appeal No. 1 of 1958. Appeal from the judgment and order dated April 18, 1956, of the former Judicial Commissioner, Ajmer, in Civil Writ Petition No. 1 of 1956. G. C. Kasliwal, Advocate General for the State of Rajasthan, section K. Kapur and D. Gupta, for the appellant. section section Deedwania and K. P. Gupta, for respondent No. 1. B. P. Maheshwari, for respondent No. 9. 1961. April 27. The judgment of the Court was delivered by 435 WANCHOO, J. This is an appeal on a certificate granted by the Judicial Commissioner, Ajmer. The brief facts necessary for present purposes are these. ,, There is a Bank in Ajmer known as the Commercial Co operative Bank Limited, Ajmer (hereinafter referred to as the Bank), which is registered under the Cooperative Societies Act, No. 11 of 1912 (hereinafter referred to as the Act). Dharam Chand, respondent No. 1 (hereinafter referred to as the respondent), along with certain other respondents were members of the managing committee of the Bank. One Nandlal Sharma was the paid manager of the Bank. This man disappeared in 1953 and thereafter defalcation to the extent of about Rs. 6,34,000 was detected. Consequently, the managing committee passed a resolution suspending the business of the Bank subject to the approval of the Registrar. The then Registrar Shri Nagar approved the resolution and appointed an Inspector of Co operative Societies to hold an immediate inquiry. He also appointed a firm of Chartered Accountants as investigating auditors. On investigation by the auditors embezzlement to the extent of about Rs. 6,34,000 was found. Thereupon the successor Registrar, Shri Chitnis, gave notice to the respondent and other members of the managing committee on February 26, 1955, asking them to show cause why the committee should not be suspended under r. 30(3) of the Rules framed under the Act. A reply to the notice was given by the respondent and others in which they denied allegations of mismanagement, etc. The then Registrar Shri Chitnis however appointed an administrator of the Bank after removing the managing committee. In the meantime, an application was made under r. 18 of the Rules by seven shareholders of the Bank to the Registrar on April 4, 1956. Rule 18 authorises the Registrar to decide any dispute brought before him under that rule either himself or through the appointment of one or more arbitrators. Any dispute concerning the business of a Co operative Society between members or past members of the Society or persons claiming through them, or between a member or past member or person 436 so claiming and the Committee or any officer can be referred under r. 18. Such reference can be made by the Committee or by the Society by resolution in general meeting or by any party to the dispute, or if the dispute concerns a sum due from a member of the committee to the Society by any member of the Society. In consequence of this application the then Registrar appointed Shri Hem Chand Sogani, an advocate, as an arbitrator. The application was in the nature of a misfeasance proceeding against the members of the managing committee and the prayer was for an award against thirteen persons (including the respondent) directing them to pay certain amounts including the entire loss amounting to about Rs. 6,34,000, which was said to have been occasioned on account of glaring breach of law and the rules and the bye laws of the Bank and betrayal of confidence by the members of the managing committee. The appointment of the arbitrator was challenged by the president of the managing committee before the Deputy Commissioner through a revision petition but the challenge failed. As however Shri Sogani was in ill health, he expressed his inability to act as arbitrator. Consequently, on December 13, 1955, the then Registrar set aside the order appointing Shri Sogani as arbitrator and informed the parties that he would decide the dispute himself. This order was also challenged in revision before the Deputy Commissioner; but the attempt failed. Thereafter the present petition was filed by the respondent before the Judicial Commissioner, Ajmer, and a large number of grounds were urged in support of it, and it was prayed that the Registrar be prohibited from proceeding to deal with the application under r. 18 and the proceedings arising therefrom be quashed. The petition was decided by the Judicial Commissioner on April 18, 1956. He negatived all the contentions raised on behalf of the respondent except one; and it is with that contention only that we are concerned in the present appeal. That contention is that the Registrar is in the position of a party and had expressed his opinion unequivocally against the respondent and other members of the committee in the notice 437 which he gave on February 26, 1955, and therefore his constituting himself as a tribunal to decide the dispute under r. 18 was against the principles of natural justice, inasmuch as a party constituted himself the judge. This contention found favour with the learned Judicial Commissioner and he held that although the Registrar had no pecuniary or proprietary interest in the dispute yet in view of the circumstances of the case there was a strong likelihood of bias and therefore the Registrar 's acting as the tribunal would be against the principles of natural justice. He further held that if the Registrar had not suffered from the disability inherent in the situation, he would have been the most proper person to decide the dispute. The petition was therefore allowed and a writ of prohibition was issued to the Registrar directing him not to proceed with the dispute before him. This was followed by an application to the Judicial Commissioner for a certificate of fitness in order to file an appeal to this court, which was granted; and that is how the matter has come up before us. The official bias of the Registrar is sought to be based on two circumstances: the first is the notice issued by the then Registrar on February 26, 1955, asking the members of the managing committee (including the respondent) to show cause why they should not be suspended, and the second is that the Registrar is the head of the Co operative Department and as such has certain legal powers over all Co operative Societies (including the Bank) in his administrative capacity and therefore he would not be an impartial person to decide this dispute, particularly in view of the provisions of section 17 of the Act. We are of opinion that there is no force in either of the contentions. Turning to the notice of February 26, 1955, we are of opinion that there can be no inference of bias against the Registrar as such because he gave that notice and afterwards ordered the removal of the managing committee. That notice was based on the report of the investigating auditors and was concerned with the collective responsibility of the 56 438 managing committee in the discharge of their duties. The proceedings under that notice have nothing in ,common with the proceedings in the present dispute which, as we have already said, are in the nature of misfeasance proceedings against certain members of the managing committee and in which their individual responsibility as members of the managing committee to make good the loss caused by the embezzlement falls to be considered. So far as the proceedings under the notice are concerned, the only question was whether on the facts found by the investigating auditors the managing committee should as a whole be allowed to act as such and all that the Registrar in that connection did was to decide on the facts found by the investigating auditors that the managing committee should no longer be allowed to manage the affairs of the Bank. That is a very different matter from the dispute in the present pro ceedings, namely, whether the particular members of the managing committee against whom the application under r. 18 has been made are responsible for making good the loss caused to the Bank by the embezzlement, the fact of which is not in dispute. In the present proceedings therefore the Registrar will have to decide the individual responsibility of the various members of the managing committee (including the respondent) in the matter of making good the loss caused to the Bank. We are therefore of opinion that the fact that the Registrar gave that notice for the purpose of the removal of the managing committee is no reason to hold that he would be biased in the investigation of individual responsibility of various members of the managing committee in this matter. We cannot therefore agree with the Judicial Commissioner that there can be any official bias in the Registrar on this ground in connection with the present dispute and that such bias disentitles him to act as a judge or arbitrator under r. 18. The next contention is that the Registrar being the administrative head of the Department is in control of all the Co operative Societies in Ajmer, including the Bank. It is said that because of that administrative control which the Registrar exercises through his 439 subordinates in the Department, he is interested to see that the blame is put on the managing committee and that his Department is freed from all blame. In, particular our attention has been drawn to section 17 which enjoins that the Registrar shall audit or cause to be audited by some person authorised by him the accounts of every registered society once at least in every year. It is said that under this provision the Registrar has been appointing Chartered Accountants to audit the accounts of the Bank and that nothing wrong was discovered in the annual audits till the paid manager Nandlal absconded and the defalcations came to light. We fail to appreciate how this general supervision of the Registrar over all Co operative Societies can be said to amount to a bias in him so as to disentitle him to act as a judge or arbitrator under r. 18. It is not the respondent 's case that the Registrar is in any way responsible for the day to day working of the Bank. All that he is concerned with is to see that the accounts of the Bank are audited yearly, and if necessary, to make inspections of the Bank, if so authorised by the Act and the Rules. That, however, does not mean that the Registrar is bound to shield the auditors or his subordinates who might have made the inspection of the Bank and would so conduct the proceedings as to put the blame on the members of the managing committee. Even if some blame attaches to the auditors appointed by the Registrar or to his subordinates who might have inspected the Bank, their fault would be that they failed to detect the embezzlement till the paid manager absconded. That, however, does not mean that the Registrar was at any time a party to the fraud which resulted in the embezzlement. Even the Judicial Commissioner recognises that the Registrar has no personal interest in the matter and that he would but for the bias found by the Judicial Commissioner have been a most proper person to decide the dispute. Therefore even if we bear in mind the fact that the Registrar is the administrative head of the Department, we see nothing inherent in the situation which shows any official bias whatsoever in him so far as adjudication of this dispute is concerned. 440 We have no reason to suppose that if any of his subordinates or the auditors appointed by him are in any way found to be connected with the fraud he would not put the responsibility where it should lie. We are therefore of opinion that the Judicial Commissioner was wrong in the view that there was anything inherent in the situation which made the Registrar a biased person who could not act as a judge or an arbitrator in this case. It seems to us, therefore, that the learned Judicial Commissioner was in error in thinking that the Registrar was biased. For the reasons earlier mentioned, we do not think that any such blemish attached to the Registrar. That being so, no question of his inability to act as a judge under the rule of natural justice that no man shall be judge in his own cause, arises. The judgment of the learned Judicial Commissioner has to be set aside on this ground alone. We do not wish however to be understood as having made any pronouncement that if it had been proved that the Registrar was suffering from any bias, then the present would have been a fit case for the issue of a writ of prohibition as asked by the respondent. Before the writ could be issued a further question would have to be decided whether in view of the statute, that is, r. 18 of the Rules framed under section 43 of the Act, there was any scope for applying the rule of natural justice on which the contesting respondent relied. A question of this kind was mentioned in Gullapalli Nageswar Rao and Others V. State of Andhra Pradesh and Others (1). In the view that we have taken it is unnecessary to go into that question and we do not do so. The result is that the appeal is allowed and the judgment of the Judicial Commissioner is set aside. The petition will stand dismissed. Respondent No. 1 will pay the costs throughout. We trust that there will be no further reason to delay the termination of the proceedings under the rules by the Registrar. Appeal allowed. (1) ; , 587.

An investigation of the affairs of a Co operative Bank registered under the , on the disappearance of the manager of the bank in 1953, showed that a very large amount of money had been defalcated. On February 26, 1955, the Registrar of Co operative. Societies gave notice to the members of the managing committee of the bank asking them to show cause why the committee should not be suspended, under r. 30(3) Of the Rules framed under the Act. In reply the members denied allegations of mismanagement etc., but the Registrar, however, appointed an administrator of the bank after removing the managing committee. In the meantime, some of the shareholders of the bank made an application before the Registrar under r. 18 of the Co operative Societies Rules, in the nature of a misfeasance proceeding against the members of the managing committee, praying for an award directing them to pay the amount found defalcated, on the ground that it had been occasioned by a glaring breach of the law and the rules 434 and the bye laws of the bank and betrayal of confidence by the members of the committee. The Registrar originally appointed an arbitrator for this purpose, but, on the inability of the arbitrator to act due to his illness, the Registrar informed the parties that he would decide the dispute himself. The legality of the procedure adopted by the Registrar was challenged in a petition filed before the judicial Commissioner, on the ground that he was in the position of a party and had expressed his opinion unequivocally against the members of the committee in the notice he gave on February 26, 1955, and therefore his con stituting himself as a tribunal to decide the dispute under r. 18 was against the principles of natural justice, inasmuch as a party constituted himself the judge. The judicial Commissioner took the view that although the Registrar had no pecuniary or properties interest in the dispute yet in view of the circumstances of the case there was a strong likelihood of bias and therefore his acting as the tribunal would be against the principles of natural justice. Held, that the notice dated February 26, 1955, was concerned with the collective responsibility of the members of the managing committee in the.discharge of their duties, while the application made under r. 18 of the Co operative Societies Rules was in the nature of misfeasance proceedings in which their individual responsibility as members to make good the loss caused by the embezzlement fell to be considered, and consequently there could be no inference of bias against the Registrar simply because he gave notice to show cause against the removal of the managing committee, as the two matters were quite different. Held, further, that the fact that Registrar had general supervision over all co operative societies could not be said to amount to a bias in him so as to disentitle him to act as a judge or arbitrator under r. 18.

Appeal No. 301 of 1960. Appeal from the judgment and decree dated September 24, 1958, of the Allahabad High Court (Lucknow Bench) at Lucknow in First Execution of Decree Appeal No. 8 of 1953. C. B. Agarwala, Shankar Prasad and C. P. Lal, for the appellant. Iqbal Ahmed, N. C. Chatterjee, D. N. Mukherjee and B. N. Ghosh, for the respondent. April 27. The Judgment of the Court was delivered by WANCHOO, J. This is an appeal on a certificate granted by the Allahabad High Court. The brief facts necessary for present purposes are these. The appellant 's father Rana Umanath Bakshsingh was the Talukdar of Khajurgaon. On July 13, 1914, Rana Umanath Bakshsingh executed a simple mortgage in favour of the Allahabad Bank Limited (hereinafter called the respondent). The mortgage was for a sum of Rs. 6,00,000 and the property mortgaged consisted of sixty seven villages. In May 1924, the respondent filed a suit for the recovery of the balance of the unpaid mortgage money by the sale of the mortgaged property. In January 1925 a preliminary decree for the recovery of rupees four lacs and odd was passed, which was made final in July 1926 and directed the sale of the mortgaged property, namely, the proprietary rights of Rana Umanath Bakshsingh in the sixty seven villages. Then followed execution applications with which we are not concerned. In 1934, the U. P. 443 Agriculturists ' Relief Act was passed and thereupon an application was made by the judgment debtor for the amendment of the decree under that Act. On October 19, 1936, the decree was amended under the provisions of that Act and thereafter the pending execution proceedings were dropped as installments had been fixed. Eventually, the respondent applied for execution on May 25, 1940. Objection was taken to this application on the ground that it was barred by time; but this matter was decided against the judgment debtor and thereafter the execution has been proceeding uptil now on this application. On July 1, 1952, the U. P. Zamindari Abolition and Land Reforms Act, 1950 (1 of 1951), hereinafter called the Act, came into force. As a consequence of this enactment, the zamindari rights of the judgment debtor were abolished and it was no longer possible to sell these rights in the sixty seven villages. Consequently, on September 29, 1952, the respondent made an application that as the zamindari rights could not be sold, only such rights of the judgment debtor as remained in him after the coming into force of the Act might be sold, namely, the rights in trees and wells in abadi and buildings situate in various villages under sale. It was also prayed that the judgment debtor 's proprietary rights in grove land and sir and khudkashat land had been continued under section 18 of the Act and these constituted substituted security in place of the proprietary rights mortgaged with the respondent and they should also be sold Finally it was prayed that compensation money payable to the judgment debtor on the acquisition of the proprietary rights by the State might be treated as substituted security. The appellant objected to these applications on various grounds. The execution court held that the buildings, trees and wells situated in the abadi were liable to be sold in execution of the decree. It further held that the respondent was entitled to compensation amount granted by the State to the appellant in lieu of zamindari rights as substituted security. Finally, it held that the bhumidari rights acquired by the 444 appellants under section 18 of the Act could also be sold in execution of the decree. The appellant then took the matter in appeal to the High Court, and the two points urged before the High Court were (i) that the bhumidari rights created by section 18 (i) of the Act could not be sold in execution of the decree, and (ii) that the application dated September 20, 1952, was a fresh application for execution and as it was filed over 12 years after the date of the amended decree it was barred by time. The High Court repelled both these contentions, and held that execution could proceed against the bhumidari rights created in favour of the appellant under section 18 of the Act and further that the application dated September 20, 1952, was within time as it was not a fresh application and the decree holder was only seeking to execute the decree in respect of the property for the sale of which he had already applied within time allowed by law. The High Court therefore dismissed the appeal. The appellant then obtained a certificate to appeal to this Court; and that is how the matter has come up before us. The main point urged on behalf of the appellant is that the decision of the High Court that bhumidari rights created under section 18 of the Act can also be sold in execution of the decree, is not correct. Under the mortgage deed, the property mortgaged consisted of the property forming part of the Talukdari of Khajurgaon detailed at the foot of the mortgage, namely, the sixty seven villages. Thus the mortgage consisted of the proprietary interests only of the mortgagor in the sixty seven villages, and as it was a simple mortgage, possession of no part of the property was given to the mortgagee. it is therefore contended by Mr. Aggarwala on behalf of the appellant that as the proprietary right in the sixty seven villages vested in the State under the Act, the respondent who was only entitled to get the proprietary rights sold under the mortgage can now fall back only on compensation payable to the appellant under the Act, and reliance in particular is placed on section 6 (h) of the Act in this connection. On the other hand, the contention on 445 behalf of the respondent is that bhumidari rights arising under section 18 of the Act are liable to be sold as they represented the proprietary rights which were mortgaged and in any case they can be sold as substituted security in place of the property mortgaged. We have therefore to look into the scheme of the Act in order to decide between the rival contentions. It is not in dispute that the Taluka of Khajurgaon was an estate within the meaning of the Act. It may be mentioned that the judgment debtor had certain sir and khudkashat lands and zamindar 's grove in the sixty seven villages comprised within the Talukdari estate. Section 4 of the Act provides for vesting of an estate in the State on the making of a notification thereunder and the Taluka of Khajurgaon has vested in the State by virtue of such a notification made under section 4. Section 6 prescribes the consequences of the vesting arising under section 4 and we may refer to section 6(a) (i) as that will show in what the interests of the judgment debtor ceased and became vested in the State: "(a) all rights, title and interest of all the intermediaries (i) in every estate in such area including land (cultivable or barren), grove land, forests whether within or outside village boundaries, trees (other than trees in village abadi, holding or grove), fisheries, tanks, ponds, water channels, ferries, pathways, abadi sites hats, bazars or melas (other than hats, bazars, melas held upon land to which clauses (a) to (c) of sub section (1) of section 18 apply), and . . . . . . . . . shall cease and be vested in the State of Uttar Pradesh free from all encumbrances. " Clause (h) of section 6 is also material and is in these terms: "(h) no claim or liability enforceable or incurred before the date of vesting by or against such intermediary for any money, which is charged on or is secured by a mortgage of such estate or part thereof shall, except as provided in section 73 of the , be enforceable against his interest in the estate. " 57 446 All lands therefore whether cultivable or barren or grove lands vested in the State on the notification under section 4 having been made save as otherwise provided in this Act. Therefore, proprietary rights in Sir and khudkashat land and grove land would vest in the State on the coming into force of the notification under section 4 unless there was some provision otherwise in the Act. The contention of the respondent therefore that sir and khudkashat land and grove land continued to be the property of the appellant and would therefore remain liable to be sold in execution proceedings would fail in view of the notification under section 4, unless of course there is a provision otherwise in the Act. The only provisions otherwise on which the respondent relies are sections 9 and 18 of the Act. So far as section 9 is concerned, it is certainly a provision otherwise and it provides as follows: "All wells or trees in abadi, and all buildings situate within the limits of an estate, belonging to or held by an intermediary or tenant or other person, whether residing in the village or not, shall continue to belong to or be held by such intermediary, tenant or person, as the case may be, and the site of the wells or the buildings with the area appurtenant thereto shall be deemed to be settled with him by the State Government on such terms and conditions as may be prescribed. " This provision clearly creates an exception to the property which vests in the State on the making of a notification under section 4. The exception is in favour of all wells and trees in abadi and all buildings and it is significant to note that these things will continue to belong to the intermediary, though the further provision shows that the site of the wells, and buildings with the area appurtenant thereto would vest in the Government and would be deemed to be settled with the intermediary on such conditions and terms as may be prescribed. The effect therefore of section 9 is that wells, trees in abadi and buildings apart from the land under them continue to belong to the intermediary (and the appellant is undoubtedly an intermediary within the meaning of the Act); but even here the 447 land on which the buildings and the wells stand vest in the State and it is deemed settled with the intermediary on terms and conditions to be prescribed. So far therefore as wells and trees in abadi and all buildings are concerned, these continue to belong to the appellant and if they are covered by the mortgage they would be liable to sale. As we have already pointed out, there was no dispute before the High Court with respect to wells, and trees in abadi and buildings and it was conceded there that these were liable to be sold, the only dispute being with respect to bhumidari rights created under section 18. Let us now turn to section 18 and see whether it is also a provision otherwise like section 9. The relevant part of section 18 for our purposes is in these terms: "(1) Subject to the provisions of sections 10, 15, 16 and 17, all lands (a) in possession of or held or deemed to be held by an intermediary as sir, khudkashat or an intermediary 's grove, on the date immediately preceding the date of vesting shall be deemed to be settled by the State Government with such intermediary, lessee, or tenant, grantee or grove holder, as the case may be, who shall subject to the provisions of this Act be entitled to take or retain possession as a bhumidar thereof. " It is well to contrast the language of this section with the language of section 9. Section 9 lays down that trees and wells in abadi and buildings shall continue to belong to the intermediary and that shows that it was a provision otherwise excepting these three items from vesting in the State by virtue of the notification under section 4 and its consequence under section 6; but there is no provision in section 18 of the Act to the effect that sir and khudkashat land and intermediary 's grove shall continue to belong to the intermediary. Therefore, sir and khudkashat land and grove land would vest in the State by virtue of section 6 (a) (i) for there is no provision otherwise in section 18 in that behalf. In this connection we may refer for comparison to section 23 of the 448 Rajasthan Land Reforms and Resumption of Jagirs Act, No. VI of 1952 (hereinafter called the Rajasthan Act) which provides that "notwithstanding anything contained in the last preceding section (i.e. section 22, which refers to consequences of resumption), all khudkashat lands of a Jagirdar etc. shall continue to belong to or be held by such jagirdar or other person". If the intention of the Act Was not to vest sir and khudkashat land and grove land in the State we would have found an exception similar to that found in the Rajasthan Act. Section 9 itself shows in what manner the legislature was making an exception when it did not intend that a particular property should vest in the State. If the intention were that sir and khudkashat land and grove land should not vest in the State, section 18 would have been worded in the same way as section 9. Further the way in which section 18 is worded, (namely that khudkashat and sir land and an intermediary 's grove shall be deemed to be settled with the intermediary and he would have bhumidari rights therein) shows that these three kinds of property vested in the State under section 6(a)(1) and were then resettled with the intermediary on a new tenure and not in the same right, which he had in them before the vesting. The legislature was therefore creating a new right under section 18 and the old proprietary right in sir and khudkashat land and any intermediary 's grove land had already vested under section 6 in the State. Therefore, it cannot be said that section 18 is an exception to the consequences provided in section 6 and therefore sir and khudkashat land and grove land continue to be the property of the judgment debtor in this case in the same manner as they were his property at the time of the mortgage and would therefore be available in execution of the decree as the proprietary rights mortgaged. We are of opinion that the proprietary rights in sir and khudkashat land and in grove land have vested in the State and what is conferred on the intermediary by section 18 is a new right altogether which he never had and which could not therefore have been mortgaged in 1914. Our attention in this connection was drawn to the 449 compensation sections in the Act, and it was urged that what was given to the intermediary under section 18 was really his old right because no compensation was to be paid to him with respect to what was left to him under section 18. The first section to be considered in this connection is section 39 which deals with gross assets of a mahal. In these gross assets the amount computed at the rates applicable to the ex proprietary tenants of similar land for land in the personal cultivation of or held as intermediary 's grove, Khudkashat or sir by all the intermediaries in the estate was to be included subject to certain exceptions which are immaterial for our purposes. The very fact that in the gross assets the rents of these lands in which the bhumidari rights were created under section 18 were taken into consideration shows that these lands also vested in the State; if that were not so there was no necessity for including these assets in the gross assets for the purposes of compensation. Here again we may refer to a similar provision in the Rajasthan Act for purposes of comparison. The second Schedule to that Act provides how gross income is to be calculated and in calculating the gross income the income from khudkashat land has not been taken into account because it was excepted from the consequence of resumption under section 23 of that Act. It is true that under section 44 of the Act when calculating net assets, the income from sir and khudkashat land and grove land has been excluded on the ground that bhumidari rights have been conferred therein under section 18 of the Act. That is however for the purposes of calculating what should, be paid to the intermediary as compensation and in that connection it was necessary to take into account the fact that the legislature was creating a new right in the intermediary with respect to certain lands and therefore it was not necessary to give money as compensation. That would not however make any difference in our view as to the legal effect of the notification under section 4 and under the notification sir and khudkashat land and grove land would vest in the State and would not be an exception to the consequences of vesting in section 6 and therefore the proprietary right in sir 450 and khudkashat land and grove land which were mortgaged would be extinguished and the bhumidari right which is created by section 18 would be a new right altogether and would not therefore be considered to be included under the mortgage in this case. This brings us to a consideration of section 6(h) of the Act. That lays down that "no claim or liability enforceable or incurred before the date of vesting by or against such intermediary for any money, which is charged on or is secured by a mortgage of such estate or part thereof shall, except as provided in section 73 of the , be enforceable against his interest in the estate". This provision has in our opinion a, two fold effect. In the first place, it makes it impossible for the mortgagee to follow the proprietary right after it vests in the State. Secondly, it provides that the only way in which the mortgagee can recover his none advanced on the security of the property which vested in the State by virtue of the notification under section 4 and the consequences thereof under section 6 is to follow the procedure under section 73 of the . Section 73(2) provides that "where the mortgaged property or any part thereof or any interest therein is acquired under the Land Acquisition Act, 1894 (1 of 1894), or any other enactment for the time being in force providing for the compulsory acquisition of immovable property, the mortgagee shall be entitled to claim payment of the mortgage money, in whole or in part, out of the amount due to the mortgagor as compensation". There is no doubt that the property mortgaged has been compulsorily acquired in this case by the State under the Act. Therefore, section 6 (h) read with section 73 directs that the mortgagee shall proceed in the manner provided in section 73, namely, follow the compensation money, and there is no other way possible for him in view of section 6(h) with respect to the property which has been acquired under the Act. We have held that sir and khudkashat land and grove land have been acquired under the Act and have vested in the State; therefore the mortgagee is relegated to enforce his rights against the mortgagor in the manner provided in section 73 of the 451 and in no other way. What we say here does not affect that property which is not acquired by the State, for example, property excepted under section 9 of the Act; but where the property has vested in the State by virtue of a notification under section 4 and its consequences under section 6, the only course open to the mortgagee is to follow the compensation money under section 6(h). The bhumidari rights created under section 18 are not compensation; they are special rights conferred on the intermediary by virtue of his cultivatory possession of the lands comprised therein. The respondent therefore cannot enforce his rights under the mortgage by sale of the bhumidari rights created in favour of the appellant under section 18 so far as his sir and khudkashat land and grove land are concerned; it can only follow the compensation money as provided in section 6(h). The argument that bhumidari rights can 'be followed as substituted security must therefore equally fail. Our attention in this connection was drawn to section 8(2) of the U. P. Zamindars Debt Reduction Act, No. XV of 1953. That Act provides for scaling down of debts of zamindars whose estates have been acquired under the Act. It also provides that the debts due shall be realisable from the compensation and rehabilitation grant, and in particular section 8(2) provides that "notwithstanding anything in any law the reduced amount found in the case of a mortgagor or judgment debtor as the case may be, under section 3 or 4 as respects mortgaged estates shall not be legally recoverable otherwise than out of the compensation and rehabilitation grant payable to such mortgagor or judgment debtor in respect of such estates". We have not been able to understand how the provisions of the U. P. Zamindars Debt Reduction Act can affect the con struction of section 6(h) of the Act read with other provisions of the Act. It is not necessary for us therefore to construe section 8(2) of the U. P. Zamindars Debt Reduction Act, for we are clear on the provisions of section 6 (h) and the other provisions of the Act that bhumidari rights created in favour of the appellant cannot be sold in execution of the decree held against him by the respondent under the mortgage of 1914. 452 This brings us to the question of limitation. Mr. Aggarwala conceded that if the appellant succeeds on the first point it would not be necessary for us to consider the question of limitation. Therefore, as the appellant succeeds on the first point we need not consider whether the application for execution by sale of bhumidari rights created under section 18 is barred by limitation. We therefore allow the appeal and direct that the execution of the decree by the respondent will not be levied against the bhumidari rights created in favour of the appellant under section 18 of the Act. The appellant will get his costs of this court and of the High Court. Costs of the execution court will be at the discretion of that Court. Appeal allowed.

The appellant 's father, a Talukdar of the Estate of Khajur gaon, executed a simple mortgage of his proprietary interest in the estate consisting of sixty seven villages to the Allahabad Bank Ltd. While execution proceedings were pending, the U. P. Zamindari Abolition and Land Reforms Act, 1950, came into force from July 1952. As a result, the Zamindari rights of the appellant judgment debtor were abolished and it was no longer possible to sell these rights in the 67 villages. The respondent Bank made an application before the executing court that as the Zamindari rights could not be sold, only such rights of the judgment debtor as remained in him after coming into force of the Act might be sold along with certain other rights. Objections were taken and finally the matter came up by appeal to the High Court and it, inter alia, upheld the view of the executing court that the execution could proceed against the Bhumidari rights created in favour of the appellant under section 18 of the Act. The question was whether the Bhumidari rights created under section 18 of the Act could also be sold in execution of the decree in view of the fact that the proprietary rights bad vested in the State. Held, that the intention of the U. P. Zamindari Abolition and Land Reforms Act was to vest the proprietary rights in the Sir and Khudkast land and grove land in the Estate by virtue of section 6(a)(i) and resettle it on the intermediary not as compensation but by virtue of his cultivatory possession of lands comprised therein and on a new tenure and confer upon the intermediary a new and special right of Bhumidari, which he Dever had before, by section 18 of the Act. The proprietary rights in Sir, Khudkast land and grove land which were mortgaged were extinguished, and the Bhumidari right which was altogether a new right could not be con sidered to be included under the mortgage. 442 The mortgagee could only enforce his rights against the mortgagor in the manner as provided by section 6(h) of the Act read with section 73 of the Transfer of Property Act and follow the compensation money; and so far as the Sir, Khudkast land and grove land were concerned, he could not enforce his rights under the mortgage by the sale of the Bhumidari rights created in favour of the mortgagor against them as a substituted security. In the instant case the Bhumidari rights created in favour of the appellant could not be sold in execution of the decree held against him by the respondent under the mortgage Of 1914.

Appeals Nos. 645 and 646 of 1957. Appeal from the judgment and decree dated August 1956, of the Patna High Court, in Second Appeals Nos. 2155 and 2156 of 1948. A. V. Viswanatha Sastri and R. C. Prasad, for the appellant. B. K. Garg, M. K. Ramamurthi, section C. Agarwal, and D. P. Singh, for respondents Nos. 1 to 4. 1961. April 28. The Judgment of the Court was delivered by VENKATARAMA AIYAR, J. These are appeal against the judgment of the High Court of Patna in Second Appeals Nos.2155 and 2156 of 1948 on certificates granted by the High Court under article 133(1)(c) of the Constitution. The facts leading to this litigation lie in a narrow compass. One Prithi Dubey died on July 14, 1932, leaving him surviving, his widow Laung Kuer, who succeeded as heir to his estate. For the purpose of discharging debts due by the deceased Laung Kuer executed on June 21, 1935, a Zerpeshgi deed in favour of two persons, Rajdewan Dubey and Kailash Dabey, who were also the next reversioners, for a sum of Rs. 1,100. It is not in dispute that this deed is binding on the reversioners. On June 17, 1943, Laung Kuer sold to the appellant a portion of the properties which were the subject matter of the Zerpeshgi deed dated June 21, 1935, for a consideration of Rs. 1,600 Out of this amount, a sum of Rs. 1,100 was reserved with the purchaser for redemption of the Zerpeshgi, and the balance of Rs. 500 was paid in cash. It is recited in the deed of sale that a sum of Rs. 100 was required to effect repairs to the family dwelling house, a sum of Rs. 200 for purchasing two bulls for agricultural purposes, and a sum of Rs. 200 for repairing a well, which had been constructed by the deceased for user by the public and which was then in a ruined condition. It is to meet these expenses that Laung Kuer raised Rs. 500. After obtaining the sale deed, the appellant sought 561 to redeem the Zerpeshgi, but the Zerpeshgidars refused to receive the amount and surrender possession of the properties. The appellant deposited the mortgage amount in court under section 83 of the Transfer of Property Act and then instituted Title Suit No. 69 of 1944 for redemption. Meantime the reversioners, the respondents herein, had filed Title Suit No. 126 of 1943 for a declaration that the sale deed in favour the appellant was not binding on the reversioners. And both the suits were tried together. The parties were at issue on several questions of fact of which the only one material at this stage is whether the sale in favour of the appellant was supported by necessity and binding on the reversioners. The District Munsif of Palamau who tried the suits held on a review of the evidence that necessity was established in respect of all the four items of consideration and that the sale was binding on the reversioners. He accordingly dismissed Title Suit No. 126 of 1943 filed by the respondents and granted a decree for redemption in Title Suit No. 69 of 1944 filed by the appellant. The respondents herein, the reversioners, preferred appeals against both the decrees passed by the District Munsif of Palamau and they were heard by the Subordinate Judge of Palamau, who, agreeing with the findings given by the District Munsif, affirmed the decrees and dismissed the appeals. Against these decrees, the respondents preferred Second Appeals Nos. 2155 and 2156 of 1948 in the High Court of Patna. While these appeals were pending, Laung Kuer died on March 14, 1952, and on the application of the respondents, the plaint in Title Suit No. 126 of 1943 was amended by adding reliefs for possession and mesne profits. The appeals were then heard by a Bench consisting of Rai and Misra, JJ., who in separate but concurring judgments, held that the sale deed in favour of the appellant was not binding on the reversioners. Misra, J., who delivered the leading judgment did not disagree with the finding of the courts below that all the four items of consideration were supported by necessity. Indeed, being a finding of fact, it would be binding on the court in Second 562 Appeal. He, however, held, following the decision in Dasrath Singh vs Damri Singh (1) that a widow cannot by selling properties subject to usufructuary mortgage jeopardise the right of the reversioners to redeem, and that, therefore, the sale would not be binding on them. A different view was taken in Lala Ram Asre Singh vs Ambica Lal (1), where it was held that a widow was not debarred from selling properties subject to mortgage where there was necessity for it merely by reason of the fact that they were subject to usufructuary mortgage which contained no personal covenant to pay. But the learned Judge declined to follow this decision and stated the reason thus: "Following, therefore, the settled practice of this Court as laid down in a number of decisions, the only course left open to us in the circumstances would be either to follow the previous Division Bench Ruling in preference to the later or to refer the case to a larger Bench for settling the position. In my opinion, however, the present case is not one in which it is desirable to refer this case to a larger Bench. Following, therefore, the authority of this Court in Dasrath Singh 's case which completely covers the present case, it must be held that the courts below were in error in relying upon the decision in Lala Ram Asre Singh 's case." In the result the learned Judge held that the sale deed in favour of the appellant dated June 17, 1943, was not binding on the reversioners. Rai, J., expressed the view that as the bona fides of the sale in favour of the appellant was questioned by the reversioners and as there had been no finding on that point by the Subordinate Judge, the matter might have to be remanded for a finding on that question, but that, as the sale deed was not supported by necessity, he agreed with the conclusion of Misra, J. The Second Appeals were accordingly allowed and consequential reliefs granted. Thereafter, the appellant applied in the High Court under article 133 for leave to appeal to this court, and in granting certificates, Ramaswami, C. J., and Raj Kishore Prasad, J., observed in their (1) 8 Pat.L.T. 314; A.I.R. 1927 Pat.(2) 1i Pat.L.T. 6; A.I.R. 1929 Pat.563 Order dated November 27, 1956, that there being a conflict between the decisions in Dasrath Singh 's case (1) and Lala Ram Asre Singh 's case (2), the point was one of sufficient importance for grant of leave to appeal to this Court. They also stated that the question as to the practice to be followed when there was a conflict of decisions, was likewise one of public importance, which ought to be settled by this Court. They accordingly granted certificates under article 133 (1)(c) and that is how these appeals come before us. Before considering the two questions referred to in the order of the High Court granting certificates, we shall deal with a contention raised on behalf of the respondents, which if well founded would necessitate a remand of these appeals. It was argued that the sale deed in favour of the appellant was not bona fide, that it had been so held by the District Munsif, but that the Subordinate Judge had failed to record a finding on this question, and that therefore there should be a remand for a decision on that point. As already stated, Rai, J., appears to have been impressed by this contention. But when the contention is further examined it will be found to be wholly without substance. What the District Munsif said was that "after the death of Prithi Dubey the relatives of Lawan Kuer had fallen on her property like vultures", and that it was quite possible "that the transaction in question was also brought at their instance and they were also benefited by it." This only means that the relatives of Laung Kuer were guilty of spoliation of the estate. But that would not affect the rights of the appellant unless he was a party to it, which, however, is not the case, and that is what the District Munsif himself observes with reference to this aspect: "But in the present suit I have got to consider the interest of Jaisri Sahu who has in good faith already paid Rs. 500 to the Mostt.and has deposited the balance of Rs. 1,100 in court for the redemption of the Zarpeshgi." This finding that the appellant himself acted bona fide was not challenged before the Subordinate Judge (1) 8 Pat.L.T. 314.A.I.R. 1927 Pat. 219.(2) 11 Pat.L.T. 6; A.I.R. 1929 Pat.564 on appeal and the point is accordingly not open to the respondents. Dealing next with the points mentioned in the Order of the High Court dated November 27, 1956, the first question that arises for decision is whether a sale by a widow of properties which are the subject matter of a usufructuary mortgage is beyond her powers when the mortgagee cannot sue to recover the amount due on the mortgage. This has been answered in the affirmative by the learned Judges of the High Court on the strength of the decision in Dasrath Singh vs Damri Singh (1). There the last male holder, one Sitaram Singh, had created a usufructuary mortgage, and after his death the widow sold the property for the discharge of this debt and of certain other debts, and for meeting the marriage expenses of her daughter and grand daughter. It was held by Das and Adami, JJ., that all these items of consideration were supported by necessity, but nevertheless the sale was not binding on the reversioners. Das, J., who delivered the judgment observed as follows "It is contended that under the terms of the usufructuary mortgage it would be open now to the plaintiffs to redeem that mortgage and it is pointed out that their right to redeem should not have been jeopardised by the widow by the transfer of the property to the mortgagee. In my opinion this argument is right and should prevail." If the learned Judge intended to lay down as an inflexible proposition of law that, whenever there is a usufructuary mortgage, the widow cannot sell the property, as that would deprive the reversioners of the right to redeem the same, we must dissent from it. Such a proposition could be supported only if the widow is in the position of a trustee, holding the estate for the benefit of the reversioners, with a duty cast on her to preserve the properties and pass them on intact to them. That, however, is not the law. When a widow succeeds as heir to her husband, the ownership in the properties, both legal and beneficial, vests in her. She fully represents the estate, the interest of (1) 8 Pat.L.T. 314; A.I.R. 1927 Pat.565 the reversioners therein being only spes successionis. The widow is entitled to the full beneficial enjoyment of the estate and is not accountable to any one. It is true that she cannot alienate the properties unless it be for necessity or for benefit to the estate, but this restriction on her powers is not one imposed for the benefit of reversioners but is an incident of the estate as known to Hindu law. It is for this reason that it has been held that when Crown takes the property by escheat it takes, it free from any alienation made by the widow of the last male holder which is not valid under the Hindu law, vide: Collector of Masulipatam vs Cavaly Venkata (1). Where, however, there is necessity for a transfer, the restriction imposed by Hindu law on her power to alienate ceases to operate, and the widow as owner has got the fullest discretion to decide what form the alienation should assume. Her powers in this regard are, as held in a series of decisions beginning with Hanooman Persaud vs Mussamat Ba booee (2), those of the manager of an infant 's estate or the manager of a joint Hindu family. In Venkaji vs Vishnu (3) it Was observed that "A widow like a manager of the family, must be allowed a reasonable latitude in the exercise of her powers, provided. . she acts fairly to her expectant heirs '." And more recently, discussing this question, it was observed in Viraraju vs Venkataratnam ( '): "How exactly this obligation is to be carried out, whether by a mortgage, sale or other means, is not to be determined by strict rules or legal formulae, but must be left to the reasonable discretion of the party bound. In the absence of mala fides or extravagance, and so long as it is neither unfair in character nor unreasonable in extent, the Court will not scan too nicely the manner or the quantum of the alienation." Judged by these principles, when there is a mortgage subsisting on the property, the question whether (1) (1861) 8 M.I.A. 529.(3) , 536.(2) (4) I.L.R. 231.72 566 the widow could sell it in discharge of it is a question which must be determined on the facts of each case, there being no absolute prohibition against her effecting a sale in a proper case. What has to be determined is whether the act is one which can be justified as that of a prudent owner managing his or her own properties. If the income from the property has increased in value, it would be a reasonable step to take to dispose of some of the properties in discharge of the debt and redeem the rest so that the estate can have the benefit of the income. In this view, the decision in Dasrath Singh 's case,( ') in so far as it held that a Bale by a widow of a property which is subject to a usufructuary mortgage is not binding on the reversioners must be held to be wrong. In Lala Ram Asre Singh 's case (2), which was a decision of Das and Fazl Ali, JJ., the facts were similar to those in Dasrath Singh 's case (1). Dealing with the contention that a sale by the widow of properties which were the subject matter of a Zerpesbgi deed was not binding on the reversioners because the Zerpeshgidar was in possession of the properties and he could not sue to recover the amount due thereunder, Das, J., delivering the judgment of the court observed: "This in my view is an impossible argument. The debt was there; it was a subsisting debt, only the creditor was in possession of a part of the estate and was unable to recover it by instituting a suit in the civil courts. But the result was that a considerable portion of the income was withdrawn from Basmati Kuer who had succeeded her husband. It is well established that where a case of necessity exists, an heiress is not bound to borrow money, with the hope of paying it off before her death. Nor is she bound to mortgage the estate, and thereby reduce her income for life. She is at liberty, if she thinks fit, absolutely to sell off a part of the estate." In our judgment these observations correctly state the position in law. It will be noticed that Das, J., deli (1) 8 Pat.L. T. 314; A.I.R. 1927 Pat.219, (2) ii Pat.L. T. 6; A.I.R. 1929 Pat.567 vered the judgment in both Dasrath Singh 's case (1) and Lala Ram Asre Singh 's case (2 ) and that the decision in Dasrath Singh 's case (1) is not referred to in the judgment in Lala Ram Asre Singh 's case (2). It has been found in this case that Laung Kuer had to raise a sum of Rs. 500 for necessary purposes. She could have done that by mortgaging other properties, but that would have reduced the income available for enjoyment by her. On the other hand, by a sale of a portion of the properties covered by the Zerpeshgi deed dated June 21, 1935, she was able to redeem the other properties and the estate had the benefit of the income from those properties. The District Munsif and the Subordinate Judge on appeal have both of them held on a review of all the facts that the sale in favour of the appellant is a proper one binding on the reversioners. We are of opinion that this finding is not open to attack in Second Appeal. Then there is the question of the practice to be followed when there is a conflict among decisions of Benches of the same High Court. When a Bench of the High Court gives a decision on a question of law, it should in general be followed by other Benches unless they have reasons to differ from it, in which case the proper course to adopt would be to refer the question for the decision of a Full Bench. In Buddha Singh vs Laltu Singh (3), the Privy Council had occasion to discuss the procedure which should be adopted when a Bench of a High Court differs from the opinion given by a previous Bench. After referring to Suraya Bhukta vs Lakhshminarasamma (4) and Chinnasami Pillai vs Kunju Pillai (5), where decisions had been given based on the opinions expressed by Devananda Bliatta in the Smriti Chandrika, the Privy Council observed: "Curiously enough there is no reference in either of the Madras judgments referred to above to a previous decision, Parasara Bhattar vs Rangaraja Bhattar (6) of the same court to which Turner, (1) 8 Pat.L.T. 314; A.I.R. 1927 Pat.(2) 11 Pat.L.T. 6; A.I.R. 1929 Pat.(3) All. (4) Mad.(5) Mad.152 (6) Mad.2. 568 C. J., was also a party. In that case the rule of the Smriti Chandrika was not accepted nor was the literal construction of the Mitakshara followed. It is usual in such cases where a difference of opinion arises in the same court to refer the point to a Full Bench, and the law provides for such contingencies. Had that course been followed their Lordships would probably have had more 'detailed reasoning as to the change of opinion on the part at least of one Judge." (pp. 622, 623). Considering this question, a Full Bench of the Madras High Court observed in Seshamma vs Venkata Narasimharao (1): "The Division Bench is the final Court of appeal in an Indian High Court, unless the case is referred to a Full Bench, and one Division Bench should regard itself bound by the decision of another Division Bench on a question of law. In England, where there is the Court of Appeal, Divisional Courts follow the decisions of other Divisional Courts on the grounds of judicial comity; see The Vera Cruz (No. 2) (2), Harrison vs Ridgway Ratkinsky vs Jacobs (4) and Phillips vs Copping If a Division Bench does not accept as correct the decision on a question of law of another Division Bench the only right and proper course to adopt is to refer the matter to a Full Bench, for which the rules of this court provide. If this course is not adopted, the courts subordinate to the High Court are left without guidance. Apart from the impro priety of an appellate Bench refusing to regard itself bound by a previous decision on. a question of law of an appellate Bench of equal strength and the difficulty placed in the way of subordinate Courts administering justice, there are the additional factors of the loss of money and, the waste of judicial time." Law will be bereft of all its utility if it should be thrown into a state of uncertainty by reason of conflicting decisions, and it is therefore desirable that in (1) I.L.R. , 474.(2) (3) (4) (5) [1935] 1 K.B. 15.569 case of difference of opinion, the question should be authoritatively settled. It sometimes happens that an earlier decision given by a Bench is not brought to the notice of a Bench hearing the same question, and a contrary decision is given without reference to the earlier decision. The question has also been discussed as to the correct procedure ' to be followed when two such conflicting decisions are placed before a later Bench. The practice in the Patna High Court appears to be that in those cases, the earlier decision is followed and not the later. In England the practice is, as noticed in the judgment in Seshamma vs Venkata Narasimharao (1), that the decision of a Court of Appeal is considered as a general rule to be binding on it. There are exceptions to it, and one of them is thus stated in Halsbury 's Laws of England, third edition, Vol. 22, para. 1687, pp. 799, 800: "The court is not bound to follow a decision of its own if given per incuriam. A decision is given per incuriam when the court has acted in ignorance of a previous decision of its own or of a court of a co ordinate jurisdiction which covered the case before it, or when it has acted in ignorance of a decision of the House of Lords. In the former case it must decide which decision to follow, and in the latter it is bound by the decision of the House of Lords." In Virayya vs Venkata Subbayya (2) it has been held by the Andhra High Court that under the circumstances aforesaid the Bench is free to adopt that view which is in accordance with justice and legal principles after taking into consideration the views expressed in the two conflicting Benches, vide also the decision of the Nagpur High Court in Bilimoria vs Central Bank of India (3 ). The better course would be for the Bench hearing the case to refer the matter to a Full Bench in view of the conflicting authorities without taking upon itself to decide whether it should follow the one Bench decision or the other. We have no doubt that when such situations arise, the Bench (1) I.L.R. , 474.(2) A.I.R 1955 Andhra 215, 217.(3) A.I. R. 570 hearing cases would refer the matter for the decision of a Full Court. In the result these appeals are allowed and the decrees passed by the trial court restored with costs throughout. One set of hearing costs. Appeals allowed.

P died on July 14, 1932, leaving behind his widow, L as his heir. On June 21, 1935, L executed a Zerpeshgi in favour of the respondents for an admittedly binding purpose, and on June 17, 1943, she sold to the appellant a portion of the properties which were the subject matter of the Zerpeshgi deed for the purpose of redeeming the Zerpeshgi and for certain other necessary purposes. The respondents who were the reversioners 559 instituted a suit challenging the validity of the sale. The trial court and the lower appellate court held that the sale was a proper one binding on the reversioners. On second appeal, a Division Bench of the Patna High Court took a contrary view and allowed the appeal. One of the judges while he did not disagree with the findings of fact of the courts below as to the necessity for the sale followed a decision of the same High Court to the effect that a widow cannot by selling properties subject to usufructuary mortgage jeopardise the right of reversioners to redeem them. A different view of the law had been taken in a later decision of that court, but the learned judge declined to follow that decision observing that the practice of that Court was either to follow the previous Division Bench ruling in preference to the later or to refer the case to a larger Bench for settling the position, but that in the present case it was not desirable to adopt the latter course. The other learned judge was of the opinion that the sale deed was not supported by necessity. Held, that the High Court was in error in holding that the sale deed in favour of the appellant was not binding on the reversioners. When there is a mortgage subsisting on the property, the question whether the widow could sell it in discharge of it is a question which must be determined on the facts of each case, there being no absolute prohibition against her effecting a sale in a proper case. What has to be determined is whether the act is one which can be justified as that of a prudent owner managing his or her own properties. Hanooman Persaud vs Mussamat Babooee, , Vankaji vs Vishnu, Bom. 534 and Viraraju vs Vankataratnam, I.L.R. , relied on. Dasrath Singh vs Damri Singh, A.I.R. 1927 Pat. 219, dis approved. Lal Ram Asre Singh vs Ambica Lal, 1929 Pat. 216, approved. Held, further, that when a Bench of the High Court gives a decision on a question of law, it should in general be followed by other Benches unless they have reasons to differ from it, in which case the proper course to adopt would be to refer the question for the decision of a Full Bench. Where two conflicting decisions are placed before a later Bench, the better course for the latter is to refer the matter to a Full Bench without taking upon itself to decide whether it should follow the one Bench decision or the other. Buddha Singh vs Laltu Singh, All. 604, Seshamma vs Venkata Narasimharao, I.I.R. , Bilimoria vs Central Bank of India, A.I.R. 1943 Nag. 340 and Virayya vs Venkata Subbayya, A.I.R. 1955 Andhra 215, con sidered.

Appeals Nos. 499 to 502 of 1958. Appeals from the judgment and decree dated July 13, 1956, of the former Travancore Cochin High Court in A. section Nos. 94, 95, 96 and 156 of 1952. G. section Pathak and G. C. Mathur, for the appellants (in C. As. 499 to 501 of 58). P. George and M. B. Krishna Pillai, for the appellants (in C. A. No. 502 of 58). T. N. Subramania Iyer, B. Ganapathy Iyer and G. Gopalakrishnan, for the respondent. January 27. The Judgment of the Court was delivered by KAPUR, J. These four appeals are brought against the judgments and decrees of the erstwhile High Court of Travancore Cochin. The appellants were the plaintiffs in the respective suits out of which these appeals have arisen and the respondent was the defendant in all the suits. As all the suits involve a common question of law, it will be convenient to dispose of them by one judgment. The facts of the cases are these. On September 9, 1943, the Nagercoil Municipal Council the respondent, passed a resolution under section 78 of the Travancore District Municipalities Act (Act XXIII of the Malayalam year 1116), hereinafter called the Act. By this resolution, it was resolved to levy a profession tax at the rates specified in the schedule. This was notified in the Government Gazette of September 26, 1943, under the name of the Commissioner of the respondent Council. In this notification, it was stated : " Any inhabitant of the local municipal town objecting to the proposal may submit his objection in writing to this office within 30 days of date of publication of this notification in the Government Gazette. This notification was also published in a local newspaper called the Abhimani. It does not appear, nor is there any assertion or allegation that any 611 objection was raised to this tax by the appellants or any one else. On January 12,,1944, a resolution under section 79 of the Act wag passed, by which the profession tax became payable from the beginning of the second half of the Malayalam year 1119. A trust, Kottar Chetty Ninar Desikavinayaga Swamy filed a suit on February 10, 1946, challenging the legality of this tax. C.A. 502 of 1958 has arisen out of that suit. Amongst other allegations, which are common to the other suits, which will be mentioned presently, the trust pleaded that it was not carrying on a profession within the meaning of the word used in the Act and that it was only a religious trust and had no profes sion. That suit was tried by the Munsif and was decreed. An appeal was taken against that decree to the District Judge. Three private limited companies carrying on business brought three suits challenging the legality of the imposition of the tax out of which the other three appeals, i.e., Civil Appeals Nos. 499 to 501, have arisen. In these suits, it was alleged that the publication of the resolution was not in accordance with the provisions of section 78 of the Act in so far as (1) it was not published by the respondent Municipal Council, but by the Commissioner; (2) the newspaper in which the advertisement was published was not selected by the Council; (3) time given in the notification was fixed not by the Council, but by the Commissioner; and (4) the period prescribed in the notification, that is, " within 30 days ", was not fixed by the Council and was not in accordance with the Act. The respondent Municipal Council denied these allegations and several issues were raised and the suits were decreed. The appeal which had been taken in the suit by the Trust was also decided in favour of that plaintiff. The result was that all the suits and the appeal were decided against the respondent Municipal Council. It took four appeals to the High Court. The decrees were reversed and the suits of the various plaintiffs were dismissed. Against those judgments and decrees, these four appeals have been brought by the plaintiffs, in the various suits, who are now the appellants. 612 In Civil Appeals Nos. 499 to 501, Counsel for the appellants has raised two points (1) that the publication was not by the Council and (2) that the time given in the notification, i.e., " within 30 days " was not in accordance with the law and as these were conditions precedent to the legality of the resolution under section 79 the resolution was ultra vires and therefore the imposition of the tax was illegal. It is, therefore, necessary to examine the various provisions of the Act upon which the whole argument has proceeded. Chapter VI of the Act deals with Taxation and Finance. In section 77 are enumerated the various taxes which can be levied by Municipal Councils. Section 78 gives the procedure for the levying of the tax and when quoted it is as follows: "section 78. Resolution of Council determining to levy tax or tolls. Any resolution of a municipal council determining to levy a tax or toll shall specify the rate at which any such tax or toll shall be levied and the date from which it shall be levied: Provided that before passing a resolution imposing a tax or toll for the first time or increasing the rate of an existing tax or toll, the council shall publish a notice in Our Government Gazette and at least in one Malayalam or Tamil newspaper having circula tion in the municipality of its intention, fix a reasonable period not being less than one month for submission of objections, and consider the objections, if any, received within the period specified." (Italics are ours). After the various steps given in section 78 have been taken, a Municipal Council has then to adopt the taxes proposed by means of a resolution under section 79, which provides : "S.79. Notification of new taxes and tolls When a municipal council shall have determined subject to the provisions of Section 78 to levy any tax or toll for the first time or at a new rate the executive authority shall forthwith publish a notification in Our Government Gazette and by beat of drum specifying the rate at which the date from which, 613 and the period of levy, if any, for which such tax or toll shall be levied. " The functions of the executive authority, that is, of the Commissioner of the Council are contained in section 16 of the Act, which is as follows : "section 16. Functions of the Executive Authority. The executive authority of the municipal council shall (a) carry into effect the resolutions of the council; (b) furnish to the council such periodical reports regarding the progress made in carrying out the resolutions of that body in the collection of taxes as the council may direct; and (c) perform all the duties and exercise all the powers specifically imposed or conferred on the executive authority by this Act, and subject, whenever it is hereinafter expressly so provided, to the sanction of the council, and subject to all other restrictions, limitations and conditions hereinafter imposed, exercise the executive power for the purpose of carrying out the provisions of this Act and be directly responsible for the due fulfilment of the purposes of this Act. " Section 16, which contains the power of the executive authority, does not support the contention of the appellants, because it provides that the executive authority has to give effect to the resolutions of the council and has to perform all duties specifically imposed on the executive authority by the Act and can also exercise executive power for the carrying out of the provisions of the Act and can act without sanction, unless the Act otherwise requires. Therefore, when the Commissioner of the respondent council got published a notification of the resolution under section 78 of the Act to impose a tax, he was acting within his powers and the fixing of the time in which objection had to be made was provided under the Act and was not exercise of authority by the executive which it did not possess. The only serious question which arises for decision is whether the period of " within thirty days " given" in the notification was compliance with the provisions of the Act or not. If it was not then is the period of 614 time mentioned a mandatory requirement, a breach of which makes the tax illegal? Counsel for the appellants in the first three appeals argued, and that argument was adopted by counsel for the appellant in the fourth appeal, that the words used in the first proviso to section 78 required that a clear period of one month had to be given for inviting objections and as "within thirty days" was not a clear period of one month, the provisions of the section had not been complied with. In support of his contention that the provision as to time was a mandatory requirement, he particularly stressed three words and phrases used in that proviso: (1) "before passing a resolution " ; (2) " shall publish " ; and (3) " fix a reasonable period not being less than one month for submission of objections. " The argument was that where these words are used, the effect was that the requirements were mandatory and not merely directory. It was submitted that the words "before" and ",shall " provided that what was mentioned in the proviso were conditions precedent for giving power to the Municipal Council to pass a resolution under a. 79 and when those two words were read along with " not being less than one month ", it was a clear indication of the mandatory nature of the requirements of the section. Quite a number of cases were relied upon by Counsel and besides this it was also emphasized that sections 78 and 79 concerned taxing matters and as the liability of the taxpayers arises after the tax is legally imposed, strict compliance with the provisions was necessary. It is not necessary to discuss all the cases on which reliance was placed. The words " not being 'less than one month " do imply that clear one month 's notice was necessary to. be given, that is, both the first day and the last day of the month had to be excluded. To put it in the language used by Maxwell on Interpretation of Statutes, 10th Edition, p. 351 : ". when. . not less than ' so many days are to intervene, both the terminal days are excluded from the computation," 615 That does not seem to have been done in the present case. But in order to decide whether this portion of the proviso is a mandatory provision, it is convenient to see the object for which it has been enacted. Under section 78, the procedure is laid down for the levying of a. new tax, which has to be done by a resolution. But in the proviso, it is stated that before such a resolution can be passed, a notice to that effect has to be published in the official gazette and also in one Malayalam or Tamil newspaper having circulation within the municipality. Then comes the period for inviting objections. The object of notifying in the Gazette and Local Newspaper is both to give notice to the public and particulary to the persons who are likely to be taxed and to invite their objections. For this purpose, the proviso requires a reasonable period of not less than one month to be given. The object of the provision is to give reasonable time and opportunity and it is given as a guidance that reasonable time would be a month. The use of the words "I reasonable period" before the words ,not being less than one month " is significant. If sufficient time has been given for the invitation of the objections which only just falls short of the period mentioned in the proviso, then it would serve the object of the legislature. The provision in regard to time in the context must be held to be directory and not mandatory. The cases under the Income tax Act like the Commissioner of Income tax vs Ekbal and Co. (1) where the notice under section 22(2) of the Income tax Act (which requires the furnishing of a return within such period not being less than thirty days) of 30 days only was held to be bad, because it was not a notice of thirty clear days, were so decided because that notice is the basis of the jurisdiction to tax, and a legal notice is an obligation imposed in order to tax an individual and it is a mandatory provision. Similarly, cases under Rent Act will also not apply. In Thompson vs Stimpson (2) the law required that not less than four (1) [1945]13 I.T.R. 154. (2) , 79 weeks ' notice shall be given for vacation of premises on a weekly tenancy and only one week 's time was given. It was held there that it was a bad notice. It was further held that four weeks ' notice was a condition precedent and the words had been used which had been interpreted in the past as providing for four clear weeks and also it was construed as four clear weeks, so that there might be certainty in the matter. In other cases, that were relied upon and which related to taxing statutes, the Municipal Council, Cuddapah vs The Madras and Southern Mahratta Railway Ltd. (1), The Borough Municipality of Amalner vs The Pratap Spinning, Weaving and Manufacturing Co. Ltd., Amalner (2) and Kalu Karim vs Municipality of Broach (3) ; it was held that taxing statutes have to be strictly construed and requirements which are precedent to the imposition of the tax have to be complied with before tax can be legally imposed. In every case the words have to be construed in the context taking into consideration the language used and the object to be achieved. As we have said above, the use of the words " not being less than one month " implies the giving of a clear month excluding both the first and the last day of the month. There is no dispute as to the meaning of that expression alone which has been so construed and the observations of Lord Parker in Thompson vs Simpson (4) will apply. But the question that arises in the present case is: what is the exact significance of these words when used in the context of the other words used in the proviso. The power of the municipality to levy the tax does not depend upon a period prescribed for notice for objections. The power to tax is derived from the Statute; the provisions relating to the length of notice inviting objections and publication are merely procedural. The object of the notification is to inform the future rate payers and to invite objections from them. The proviso itself uses words " reasonable time" '. Reading " reasonable time " and " not being less than one month" together, it is clear that the (1) Mad. 779. (2) I.L.R. (3) Bom. (4) 617 time given must be reasonable and the legislature has only added a guide so that periods shorter than a month may not be fixed. In the present case the whole of the period except one day has been fixed and in view of the other facts it must be regarded as reasonable and to have complied with the provision which is directory in its later part. Counsel for the appellants in C. A. 499/501/58 wanted to raise a further objection to the legality of the tax levied and that ground was that the appellants were not carrying on a profession as they were only engaged in motor business and trade. This question was never raised at any previous stage and was not taken in the statement of the appellants ' case. Therefore, it cannot be allowed ' to be raised. Besides it is without any substance in view of the definition of profession as given in section 91 of the Act, which includes business. In our opinion, the High Court ,Was right in so holding and the three appeals Nos. 499 to 501 of 1958 are dismissed with costs, one hearing fee. Coming now to Civil Appeal No. 502 of 1958, in the plaint it was alleged that the trust was a religious trust and was following no profession and therefore it did not fall within the definition of the word " profession " as used in section 91 of the Act. The defendant joined issue and the matter was put in issue in the following form: "Is the taxation by defendant of plaintiff illegal and in contravention of the provisions of the District Municipalities Act ?" Although no specific finding was given as regards the operation of section 91, the suit was decreed and the question whether the trust followed a profession or not seems to have got lost at the subsequent stages of the proceedings, that is, in appeal in the court of the District Judge and in the High Court. It is this point which was urged by counsel for the trust; his plea was that his case was not covered by section 91, as being a religious trust it had no profession and was carrying on none. That is a matter which, in our opinion, should have been decided, and as neither the District 618 Judge nor the High Court has given a finding on that point, it is necessary to remit the case to the High Court with the direction that the appeal be reheard and that particular question be decided on the materials on the record. Nothing that has been said in this judgment must be taken to be an expression of opinion on the merits of this plea taken by the appellant Trust. Appeal No. 502 of 1958, is therefore, allowed and the case remitted to the High Court for decision. The costs in this Court and in the High Court will abide the decision of the appeal in the High Court. Appeals nos. 499 to 501 dismissed. Appeal No. 502 allowed. Case remitted.

The imposition of "profession tax" by the respondent Municipal Council under the Travancore District Municipalities Act (Act XXIII of the Malayalam year 1116) was challenged on the grounds, inter alia (1) that the requisite notification was not published by the Municipal Council but by its commissioner, (2) that the period of thirty days which was given for filing objections to the imposition was insufficient in law which required a period of " not less than a month ", and (3) that this was a mandatory provision under the proviso to section 78 of the Act. Held, that under section 16 the Commissioner being the executive authority of the Municipal Council was authorised to give effect to the resolutions of the Council and to perform all its executive duties. The words " not being less than one month " in the proviso to section 78 implied the necessity for one clear month 's notice excluding the first and last day of the month, but the use of the words " reasonable period " before the words " not being less than one month " showed that the time given must be reasonable. In view of the facts of the case the period allowed must be regarded as reasonable and to have complied with the provision which is directory in its later part. Commissioner of Income tax vs Ekbal and Co. [1945] 13 I.T.R. 154 and Thompson vs Stimpson, , distinguished. Municipal Council, Cuddapah vs The Madras and Southern Mahratta Railway Ltd. Mad. 779, The Borough Municipality of Amalner vs The Pratap Spinning, Weaving and Manufacturing Co. Ltd., Amalner, I.L.R. and Kalu Karim vs Municipality of Broach BOM. 764, referred to. 610 The definition of " profession " as given in section 81 includes business.

Appeal No. 341 of 1960. Appeal from the judgment and order dated March 3,1960, of the Madras High Court, in W. P. No. 1051 of 1959. N. C. Chatterjee, B. R. L. Iyengar and D. Gupta, for the appellants. 589 section Mohan Kumaramangalam, M. K. Ramamurthy, R. K. Garg and T. section Venkataraman, for the respondent and the intervener. April, 28. The Judgment of Gajendragadkar, Sarkar and Das Gupta, JJ., was delivered by Gajendragadkar, J. Wanchoo and Ayyangar, JJ., delivered separate Judgments. GAJENDRAGADKAR, J. On a writ petition filed by the respondent K. Rangachari in the Madras High Court under article 226 of the Constitution a writ of mandamus has been issued by the said High Court restraining the appellants, the General Manager, Southern Railway, and the Personnel Officer (Reservation), Southern Railway, from giving effect to the directions of the Railway Board ordering reservation of selection posts in Class III of the railway service in favour of the members of the Scheduled Castes and Scheduled Tribes and in particular the reservation of selection posts among the Court Inspectors in Class III one of which is held by the respondent. After the writ was thus issued the appellant applied for and obtained a certificate from the said High Court under article 132(1) of the Constitution as it involved a substantial question of law, namely, the scope of article 16(4) of the Constitution. It is with this certificate that the appeal has been brought to this court, and the. only question which it raises for our decision is about the scope and effect of article 16(4). This question is of considerable public importance though the dispute raised by it lies within a very narrow compass. In the railway services there are four grades of Court Inspectors included in Class III, (1) Court Inspectors on Rs. 200 300, (2) Court Inspectors on Rs. 260 350, (3) Chief Court Inspectors on Rs. 300400, and (4) Chief Court Inspectors on Rs. 360 500. It appears that Inspectors of the first category are recruited partly directly and partly by selection from other categories of railway services. To the remaining three grades appointments are made by promotion and they are classified as selection posts. Selection to 75 590 these grades is made by a committee of officers constituted for the purpose. In respect of non selection posts seniority in service is the qualification but in regard to selection posts seniority is only one of the qualifications for promotion to such posts; suitability to promotion is considered on other relevant grounds .as well. The respondent was initially recruited to the grade of Rs. 200 300 and was confirmed in that, grade on November 21, 1956. Between May 23, 1958, and August 22, 1958 as well as between December 8, 1958 and December 31, 1958, he was promoted to officiate in the grade of Rs. 260 350. He got a chance of another similar promotion to officiate on April 8, 1959. These promotions were in the nature of ad hoc promo tions and were consequently of temporary duration. Later, on June 16, 1959, he was interviewed by the selection committee and his promotion to the said higher grade was regularised and an order was passed in that behalf on June 30, 1959. By this order lie was allowed to continue to officiate in the said grade. Since then he has been officiating in that grade. On April 27, 1959, and on June 12, 1959, the two impugned circulars were issued by the Railway Board and addressed to the General Managers. As a result of the said circulars the selection committee decided to consider the case of Hiriyanna for promotion to the grade of Rs. 260 350, Hiriyanna being a member of the Scheduled Castes. The record shows that at the time when the respondent was interviewed and selected he was placed as Number One by the selection committee and one Partliasarathy was placed as Number Two. On the said occasion Hiriyanna was not selected and put in the panel. The selection committee desired to examine the case of Hiriyania in order to decide whether he was suitable for promotion to higher grade in the light of the two directives issued by the Railway Board and so a meeting of the selection committee was called on November 18, 1959. The respondent thought that the proceedings of the said proposed meeting may result prejudicially to his interest and so on November 16, 1959, he filed the 591 present Writ Petition No. 1051 of 1959. In this petition he applied for a writ in the nature of mandamus and also prayed for an interim injunction restraining the holding of the meeting of the selection committee proposed to be held on November 18, 1959. An interim injunction as prayed for by the respondent was issued by the High Court and in consequence the proposed meeting has not been held. According to the respondent the two directives issued by the appellants under the two impugned circulars were ultra vires, illegal, inoperative and unconstitutional in that they were not justified by article 16(4). He alleged that a reading of articles 16, 335, 338 and 339 would show that the Constitution draws a clear distinction between Scheduled Castes or Tribes on the one hand and backward classes on the other and so it was urged by him that the impugned circulars were illegal. The petition further urged that the safeguard provided by article 16(4) applied only to reservation Of posts at the stage of appointment and not for reservation of posts for promotion after appointment and so the circulars were outside the provisions of article 16(4) and as such contravened article 16(1). The petition expressed the apprehension that if the circulars are implemented the respondent would be reverted and that would cause great loss both financially and in status to him. It is on these allegations that the respondent prayed for the issue of a writ in the nature of mandamus directing the appellants to forbear from implementing the two impugned circulars. These pleas were denied by the appellants. It was alleged by them that the expression "backward class" appearing in article 16(4) would include not only the Scheduled Castes and Scheduled Tribes but all backward communities who could not stand on their own legs. Therefore the reservations made by the impugned circulars were fully covered by article 16(4). The appellants ' case was that the safeguards provided by article 16(4) would extend not only to initial appointment but also to promotions made by selection and that clearly brought the impugned circulars within the 592 protection of article 16(4). The appellants categorically denied that the respondent would suffer any loss or because persons who had already been promoted on the basis of earlier regular selections were not intended to be reverted as a consequence of the implementation of the impugned circulars. According to the appellants the petition filed by the respondent was permature and on the merits no case had been made out for the issue of a writ of mandamus. At this stage it would be material to set out the relevant portions of the impugned circulars. The circular issued by the Railway Board on April 27, 1959, contained, inter alia, the following directions. "There are different grades of Class III posts. Some of these posts are 'non selection ' posts, promotion to which is made on 'seniority cum suitability ' basis, while, in the case of others which are 'Selection ' posts, promotion is made by a positive act of selection. There will be no quota for Scheduled Castes and Scheduled Tribes candidates in respect of promotion to 'non selection ' posts. For promotion to 'Selection ' posts, however, there will be the prescribed quota of reservation. The field of consideration in the case of Scheduled Castes and Scheduled Tribes candidates should be four times the number of posts reserved without any condition of qualifying period of service in their case, subject to the condition that consideration should not normally extend to such staff beyond two grades immediately below the grade for which selection is held. " There is one more direction given by the said circular which must be read. The decision of the Railway Board providing reservation for Scheduled Castes and Scheduled Tribes in promotion vacancies as laid down above comes into effect from January 4, 1957. It will, therefore, be necessary to calculate the number of posts that should have been made available to the Scheduled Castes and Scheduled Tribes during 1957 and 1958 and these should be carried forward to be filled in 1959. Thus it would be noticed that the effect of this circular was to prescribe a quota of reservation for selection posts and to give effect to this reservation retrospectively from January 4, 593 1957. In a sense it is this retrospective operation of the circular which appears to be the main cause of the present dispute. On June 12,1959, another circular was issued giving guidance and directions as to how the earlier circular should be implemented. This circular directed, inter alia, by paragraphs 2(ii) and 2(iii) as follows: "2(ii). The Special Rosters in force for section C. & section T. in direct recruitment categories are to be followed to work out the number of posts to be reserved for section C. & section T. in promotions made in Selection Grades and for promotion from Class IV to Class 111. 2(iii). As the Board 's orders have retrospective effect from 4th January, 1957, it is necessary that the promotions made in each selection grade on your Division/Office from 4th January, 1957, are reviewed and the number of posts due to section C. & section T. worked out applying the Roster referred to in item (ii) above. " It appears certain doubts were raised in regard to the manner in which the reservation circulars had to be implemented and so on September 11, 1959, the Railway Board issued a letter clarifying the doubts raised. One of the points thus clarified was whether the instructions issued in the Board 's letter contemplated reversion of staff already promoted to selection posts after January 4, 1957, to accommodate section Cs. and section Ts. (which stand for Scheduled Castes and Scheduled Tribes) according to percentage basis. The clarification issued was that the said orders did not contemplate such reversion. It was, however, desired that the shortfalls should be made good against the existing as well as the future vacancies. It is by virtue of this clarification that the respondent was assured by the appellants during the proceedings before the High Court that he need not entertain any apprehension of reversion as a result of the implementation of the impugned circulars. We would now briefly summarise the findings and conclusions of the High Court on the points raised before it by the contentions of the parties in the 595 whether article 16(1) and (2) refer to promotion or whether they are confined to the initial appointment to any post in civil service. In the appeal before us the s, appellants and the respondent both conceded that cases of promotion fell within article 16(1) and (2) though they differed as to whether they were included in article 16(4). It would be immediately noticed that the respondent 's petition postulates the inclusion of promotion in article 16(1) and (2) for it is on that assumption that he challenges the validity of the impugned circulars. Similarly, the appellants ' defence postulates that article 16(1) and (2) as well as article 16(4) refer to cases of promotion for it is on the basis that article 16(4) includes promotion that they seek to support the validity of the impugned circulars. When this appeal was argued before the Constitution Bench on the first occasion it became clear that neither party was interested in contending that the guarantee afforded by article 16(1) and (2) is confined only to initial appointment and does not extend to promotion, and so notice was ordered to be issued to the Attorney General. In response to the notice the Attorney General has appeared and is represented by Mr. Sen. He has also taken the same stand as the appellants have done and so in the result nobody before us is interested in challenging the inclusion of promotion within article 16(1) and (2). However, we would briefly indicate our reasons for accepting the concession made by the parties that promotion is included in article 16(1) and (2). Article 16(1) reads thus: "There shall be equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State." In deciding the scope and ambit of the fundamental right of equality of opportunity guaranteed by this Article it is necessary to bear in mind that in construing the relevant Article a technical or pedantic approach must be avoided. We must have regard to the nature of the fundamental right guaranteed and we must seek to ascertain the intention of the Constitution by construing the material words in a broad 596 and general way. If the words used in the Article are wide in their import they must be liberally construed in all their amplitude. Thus construed it would be clear that matters relating to employment cannot be confined only to the. initial matters prior to the act of employment. The narrow construction would confine the application of article 16(1) to the initial employment and nothing else; but that clearly, is only one of the matters relating to employment. The other matters relating to employment would inevitably be the provision as to the salary and periodical increments therein, terms as to leave, as to gratuity, as to pension and as to the age of superannuation. These are all matters relating to employment and they are, and must be, deemed to be included in the expression "matters relating to employment" in article 16(1). Similarly, appointment to any office which means appointment to an office like that of the Attorney General or Comptroller and Auditor General must mean not only the initial appointment to such an office but all the terms and conditions of service pertaining to the said office. What article 16(1) guarantees is equality of opportunity to all citizens in respect of all the matters relating to employment illustrated by us as well as to an appointment to any office as explained by us. This equality of opportunity need not be confused with absolute equality as such. What is guaranteed is the equality of opportunity and nothing more. Article 16(1) or (2) does not prohibit the prescription of reasonable rules for selection to any employment or appointment to any office. Any provision as to the qualifications for the employment or the appointment to office reasonably fixed and applicable to all citizens would certainly be consistent with the doctrine of the equality of opportunity; but in regard to employment, like other terms and conditions associated with and incidental to it, the promotion to a selection post is also included in the matters relating to employment, and even in regard to such a promotion to a selection post all that article 16(1) guarantees is equality of opportunity to all citizens who enter service. 597 If the narrow construction of the expression "matters relating to employment" is accepted it would make the fundamental right guaranteed by article 16(1), illusory. In that case it would be open to the State ' to comply with the formal requirements of article 16(1) by affording equality of opportunity to all citizens in the matter of initial employment and then to defeated its very aim and object by introducing discriminatory provisions in respect of employees soon after their employment. Would it, for instance, be open to the State to prescribe different scales of salary for the same or similar posts, different terms of leave or superannuation for the same or similar post? On the narrow construction of article 16(1) even if such a dis criminatory course is adopted by the State in respect of its employees that would not be violative of the equality of opportunity guaranteed by article 16(1). Such a result could not obviously have been intended by the Constitution. In this connection it may be relevant to remember that article 16(1) and (2) really give effect to the equality before law guaranteed by article 14 and to the prohibition of discrimination guaranteed by article 15(1). The three provisions form part of the same constitutional code of guarantees and supplement each other. If that be so, there would be no difficulty in holding that the matters relating to employment must include all matters in relation to employment both prior, and subsequent, to the employment which are incidental to the employment and form part of the terms and conditions of such employment. Article 16(2) provides that no citizen shall, on grounds only of religion, race, caste, sex, descent, place of birth, residence or any of them, be ineligible for, or discriminated against in respect of, any employment or office under the State. This sub Article emphatically brings out in a negative form what is guaranteed affirmatively by article 16(1). Discrimination is a double edged weapon; it would operate in favour of some persons and against others; and article 16(2) prohibits discrimination and thus assures the effective enforcement of the fundamental right of equality of 76 598 opportunity guaranteed by article 16(1). The words "in respect of any employment" used in article 16(2) must, therefore, include all matters relating to employment as specified in article 16(1). Therefore, we are satisfied that Mr. Sen is right when on behalf of the Attorney General he conceded that promotion to selection Posts 'is included both under article 16(1) and (2). Broadly stated the Bombay and the Patna High Courts sup , port the concession made by Mr. Sen (Vide: Pandurang Kashinath More vs The Union of India(1); Sukh nandan vs State (2) ) whereas the Allahabad High Court is against it (vide: Moinuddin vs State of Uttar Pradesh (3) ). In this connection we ought to add that Civil Appeal No. 579 of 1960 (4) in which the Union of India challenged the correctness of the Bombay decision was set down for hearing along with this appeal, and in the judgment which we are pronouncing in the said appeal today we are accepting the appellants ' contention that the question about the invasion of the fundamental right guaranteed by article 16(1) was not properly raised by the respondent in his plaint in that case and had in fact not been proved; accordingly we are holding that 'the High Court was in error in proceeding to deal with the dispute on the basis that violation of article 16(1) had been admitted by the Union. In the result we are allowing the said appeal and setting aside the decision of the High Court on this narrow ground. Article 16(3) provides for one exception to the provisions of article 16(1) and (2) in that it authorises Parliament to make any law prescribing, in regard to a class or classes of employment or appointment to an office under the Government of, or any local or other authority within, a State or Union territory, any requirement as to residence within that State or Union territory prior to such employment or appointment. We are not concerned with this provision in the present appeal. (1) I.L.R. (2) Pat. (3) A.I.R. 1960 All. 484. (4) Union of India vs Pandurang Kashinath More. 599 That takes us to article 16(4). It reads thus: "Nothing in this article shall prevent the State, from making any provision for the reservation of appointments or posts in favour of any backward class of citizens which, in the opinion of the State, is not adequately represented in the services under the State." In construing article 16(4) the respondent is no doubt entitled to contend that this sub Article in substance provides for an exception to the fundamental rights guaranteed by article 16(1) and (2) and as such it must be strictly construed. On the other hand, the appellants may well urge that in construing its provisions the Court should not lose sight of the fact that the Constitution has, if we may say so wisely, showed very great solicitude for the advancement of socially and educationally backward classes of citizens. Article 15(4) which provides, inter alia, for an exception to the prohibition of discrimination on grounds specified in article 15(1) lays down that nothing contained in the said Article shall prevent the State from making any special provision for the advancement of any socially and educationally backward classes of citizens or for the Scheduled Castes and the Scheduled Tribes. Similarly, article 335 requires that the claims of the members of the Scheduled Castes and the Scheduled Tribes shall be taken into consideration, consistently with the maintenance of efficiency of administration, in the making of appointments to services and posts in connection with the affairs of the Union or of a State. For historical reasons which are well known the advancement of socially and educationally backward classes has been treated by the Constitution as a matter of paramount importance and that may have to be borne in mind in construing article 16(4). On one point in relation to the construction of article 16(4) the parties are in agreement. It is common ground that article 16(4) does not cover the entire field covered by article 16(1) and (2). Some of the matters relating to employment in respect of which equality of opportunity has been guaranteed by article 16(1) and (2) do not fall within the mischief of non obstantive 600 clause in article 16(4). For instance, it is not denied by the appellants that the conditions of service relating 'to employment such as salary, increment, gratuity, y pension and the age of superannuation there can be no exception even in regard to the backward classes of citizens. In other words, these matters relating to employment are absolutely protected by the doctrine of equality of opportunity and they do not form the subject matter of article 16(4). That is why we have just observed that part of the ground covered by article 16(1) and (2) is admittedly outside the scope of article 16(4). The point in dispute is: Is promotion to a selection post which is included in article 16(1) and (2) covered by article 16(4) or is it not? It is on, this point that there is a sharp controversy between the parties. Before construing article 16(4) it would be convenient to deal with the question as to whether posts specified by it are posts inside the services or outside them. As we have already seen the High Court has taken the view that the posts in the context must necessarily mean posts outside the services and that in fact is the sole basis of the decision of the High Court against the appellants. The High Court has held that the legislative history of the words "appointments" and "Posts" justifies the conclusion that "posts" are ex cadre posts. Is that really so? In our opinion, the answer to this question must be in the negative. The argument that legislative history about the use of the relevant words is decisively in favour of excluding service posts from the purview of article 16(4) ignores the fact that there can be no legislative history for the provisions of article 16(4) which have found a place in the Constitution for the first time. Besides, it is not correct to assume that even the legislative history shows that "posts" always and inevitably meant posts outside services though it may be conceded that in the majority of corresponding constitutional provisions they do refer to ex service posts. Let us look at the relevant provisions of the Constitution itself. Article 309 empowers the appropriate Legislature to regulate the recruitment and conditions of service of persons appointed to public services and 601 posts in connection with the affairs of the Union or of any State. In the context "posts" means posts outside services. Similarly article 310(1) refers to every person 'who is a member of a defence service or of a civil service of the Union or of an all India service or holds any post connected with defence or any civil post under the Union. The word "post" in the context means an ex cadre post. Likewise the expression "civil post" in article 311(1) means a civil post outside the services. Article 335 to which we have referred uses the word "posts" in the same sense. But, when we go to article 336 the word "posts" in the context means posts in the services therein enumerated. The position disclosed by the corresponding provisions of the Constitution Act of 1935 is substantially the same. Sections 240 and 241 for instance use the word "posts" in the sense of ex service posts; whereas section 246 refers to civil posts in the sense of posts inside the services. In our opinion, it would, therefore, be unreasonable to treat the word "posts" as a term of art and to clothe it inexorably with the meaning of excadre posts. It is the context in which the word "posts" is used which must determine its denotation. What does the context of article 16(4) indicate? That is the next question which we must consider. Article 16(4) clearly shows that the power conferred by it can be exercised in cases where the State is of the opinion that any backward class of citizens is not adequately represented in the services under it. In other words, the opinion formed by the State that the representation available to the backward class of citizens in any of the services is inadequate is a condition precedent for the exercise of the power conferred by article 16(4), and so the power to make reservation as contemplated by article 16(4) can be exercised only to make the inadequate representation in the services adequate. If that be so, both "appointments" and "posts" to which the operative part of article 16(4) refers and in respect of which the power to make reservation has been conferred on the State must necessarily be appointments and posts in the ser vice. It would be illogical and unreasonable to 602 assume that for making the representation adequate in the services under the State a power should 'be given to the State to reserve posts outside the cadre of services. If the word "posts" means excadre posts reservation of such posts cannot possibly cure the imbalance which according to the State is disclosed in the representation in services under it. Therefore, in our opinion, the key clause of article 16(4) which prescribes a condition precedent for invoking the power conferred by it itself unambiguously indicates that the word "posts" cannot mean ex cadre posts in the context. In fairness to Mr. Kumaramangalam, who appeared for the respondent, we ought to add that he did not resist the contention of Mr. Chatterjee, for the appellants, that the context requires that "Posts" should be deemed to be posts inside services and not outside them. Therefore, the main, if not the sole, reason given by the High Court in support of its conclusion does not appear to us to be well founded, and so article 16(4) must be construed on the basis that both "appointments" and "posts" to which its operative clause refers are appointments and posts in the services under the State. Incidentally, we may repeat what we have already pointed out that the tenor of the judgment under appeal shows that if the High Court had construed the word "posts" as posts inside the services it would not have issued the writ in favour of the respondent. Having in substance conceded that "posts" does not mean posts outside services Mr. Kumaramangalam presented a very plausible argument in support of his case that the impugned circulars fall outside article 16(4). He contends that the key clause on which Mr. Chatterjee relies in construing the word "posts" as meaning posts in the services itself shows that direct promotion to selection posts by reservation is not permissible under article 16(4). His argument is that if it is discovered that any backward class of citizens is not adequately represented in the services under the State the State may no doubt seek to introduce the balance by giving adequate representation to the backward class by making reservations for initial 603 appointments. It may decide the proportion of the said reservation in order to introduce the balance and then give effect to it by making adequate number of appointments by reservation at the initial stage. If ' this process by itself appears to the State to be slow and tardy it may even reserve selection posts but this reservation can be given effect to again by promoting( suitable backward candidates to the said posts after they fall vacant and making a proportionately larger number of appointments at the initial stage. In any case reservation must work from the bottom and reservation cannot be permitted to allow direct appointment to selection posts as the impugned circulars seek to do. It may be conceded that reservation of appointments or posts maybe made in the manner suggested by Mr. Kumaramangalam. It may also be assumed that giving retrospective effect to reservations may well cause heart burning or dissatisfaction amongst the general class of employees and in that sense it would be an act of wisdom not to give effect to reservation retrospectively. But, with the propriety or the wisdom of the policy underlying the circulars We are not directly concerned. Even if it be assumed that it would be open to the State to adopt the method suggested by Mr. Kumaramangalam to give effect to the power of reservation in order to make the representation of the backward classes adequate in its services does it follow that it is the only method permissible under article 16(4)? We are inclined to hold that the answer to this question cannot be in favour of the respondent. If it is conceded that selection posts can be reserved it is difficult to see how it would be open to the respondent to contend that these reserved selection posts must be filled only prospectively and not retrospectively. The concession that selection posts can be reserved on which the argument is based itself provides the answer to the argument that if the said posts can be reserved the reserved posts can be filled either prospectively or retrospectively. In adopting the latter course there can be no violation of the constitutional provision contained in article 16(4). 604 The condition precedent for the exercise of the powers conferred by article 16(4) is that the state ought to be satisfied that any backward class of citizens is not adequately represented in its services. This condition precedent may refer either to the numerical inadequacy of representation in the services or even to the qualitative inadequacy of representation. The advancement of the socially and educationally backward classes requires not only that they should have adequate representation in the lowest rung of services but that they should aspire to secure adequate representation in selection posts in the services as well. In the context the expression 'adequately represented ' imports considerations of "size" as well as "values", numbers as well as the nature of appointments held and so it involves not merely the numerical test but also the qualitative one. It is thus by the operation of the numerical and a qualitative test that the adequacy or otherwise of the representation of backward classes in any service has to be judged; and if that be so, it would not be reasonable to hold that the inadequacy of representation can and must be cured only by reserving a proportionately higher percentage of appointments at the initial stage. In a given case the state may well take the view that a certain percentage of selection posts should also be reserved, for reservation of such posts may make the representation of backward classes in the services adequate, the adequacy of such representation being considered qualitatively. If it is conceded that "posts" in the context refer to posts in the services and that selection posts may be reserved but should be filled only in the manner suggested by the respondent then we see no reason for holding that the reservation of selection posts cannot be implemented by promoting suitable members of backward class of citizens to such posts as the circulars intend to do. We must in this connection consider an alternative argument that the word "posts" must refer not to 605 selection posts but to posts filled by initial appointments. On this argument reservation of appointments means reservation of certain percentage in the initial appointments and reservation of posts means reservation of initial posts which may be adopted in order to expedite and make more effective the reservation of appointments themselves. On this construction the use of the word "posts" appears to be wholly redundant. In our opinion, having regard to the fact that we are construing the relevant expression "reservation of appointments" in a constitutional provision it would be unreasonable to assume that the reservation of appointments would not include both the methods of reservation, namely, reservation of appointments by fixing a certain percentage in that behalf as well as reservation of certain initial posts in order to make the reservation of appointments more effective. That being so, this alternative argument which confines the word "posts" to initial posts seems to us to be entirely unreasonable. On the other hand, under the construction by which the word "posts" includes selection posts the use of the word "posts" is not superfluous but serves a very important purpose. It shows that reservation can be made not only in regard to appointments which are initial appointments but also in regard to selection posts which may fall to be filled by employees after their employment. This construction has the merit of interpreting the words "appointMents" and "posts" in their broad and liberal sense and giving effect to the policy which is obviously the basis of the provisions of article 16(4). Therefore, we are disposed to take the view that the power of reservation which is conferred on the State under article 16(4) can be exercised by the State in a proper case not only by providing for reservation of appointments but also by providing for reservation of selection posts. This construction, in our opinion, would serve to give effect to the intention of the Constitution makers to make adequate safeguard for the advancement of backward classes and to secure for their adequate representation in the services. Our 77 06 conclusion, therefore, is that the High Court was in error in holding that the impugned circulars do not all within article 16(4). It is true that in providing for the reservation of appointments or posts under article 16(4) the State has to take into consideration the claims of the members of the backward classes consistently with the maintenance of the efficiency of administration. It must not be forgotten that the efficiency of administration is of such paramount importance that it would be unwise and impermissible to make any reservation at the cost of efficiency of administration. That undoubtedly is the effect of article 335. Reservation of appointments or posts may theoretically and conceivably mean some impairment of efficiency; but the risk involved in sacrificing efficiency of administration must always be borne in mind when any State sets about making a provision for reservation of appointments or posts. It is also true that the reservation which can be made under article 16(4) is intended merely to give adequate representation to backward communities. It cannot be used for creating monopolies or for unduly or illegitimately disturbing the legitimate interests of other employees. In exercising the powers under article 16(4) the problem of adequate representation of the backward class of citizens must be fairly and objectively considered and an attempt must always be made to strike a reasonable balance between the claims of backward classes and the claims of other employees as well as the important consideration of the efficiency of administration; but, in the present case, as we have already seen ' the challenge to the validity of the impugned circulars is based on the assumption that the said circulars are outside article 16(4) because the posts referred to in the said Article are posts outside the cadre of services and in any case, do not include selection posts. Since, in our opinion, this assumption is not well founded we must hold that the impugned circulars are not unconstitutional. In the result the decision of the High Court under appeal is reversed and the respondent 's application 607 for a writ is dismissed. There would be no order as to costs. WANCHOO, J. I have read the judgment just delivered by my learned brother Gajendragadkar J., and I agree with him as to the scope of article 16(1) of the Constitution. I also agree with him that the scheduled castes and the scheduled tribes are included in the words "backward class of citizens" in article 16(4) and that the word "Posts" in that Article refers to posts in the services and not to posts outside the services. I regret however that I have not been able to persuade myself that article 16(4) permits reservation even in grades within a particular service in case the service has various grades in its cadre, and proceed to give my reasons for the same. Before I construe the words of article 16(4), I may state that I am not unmindful of the fact that article 16(4) is a constitutional provision and that constitutional provisions are not to be interpreted in any narrow or pedantic sense. At the same time it cannot be forgotten that article 16(4) is in the nature of an exception or a proviso to article 16(1), which is a fundamental right providing equality of opportunity for all citizens in matters relating to employment or appointment to any office under the State. This aspect of article 16(4) in my opinion inevitably requires that the proviso or the exception should not be interpreted so liberally as to destroy the fundamental right itself to which it is a proviso or exception. The construction therefore of article 16(4) cannot ignore this aspect of the matter. I now read article 16(4): "Nothing in this article shall prevent the State from making any provision for the reservation of appointments or posts in favour of any backward class of citizens which, in the opinion of the State, is not adequately represented in the services under the State. " Before I turn to the actual words used in the Article I must refer to what I consider is implicit in that Article. The Article provides for reservation of 608 appointments or posts and it seems tome obvious that it is implicit in the Article that the reservation of appointments or posts cannot go to the length of reserving all appointments or posts or even to the length of reserving a majority of them. The reason why I say that all appointments or posts cannot be reserved under article 16(4) (though that would be the result if the widest possible interpretation is given to the words used in the Article) is that if all appointments or posts could be reserved under article 16(4) it would mean complete destruction of the fundamental right guaranteed under article 16(1). It could not be the intention of the Constitution makers that the proviso or exception in article 16(4) should be so used as to destroy completely the fundamental right enshrined in article 16(1). Nor do I think that it is permissible under article 16(4) to reserve a majority of appointments or posts, for that again, in my opinion, though it may not completely destroy the fundamental right guaranteed under article 16(1) will certainly make it practically illusory. Again it could not be the intention of the Constitution makers that article 16(4) should be so interpreted as to make the fundamental right guaranteed under article 16(1) illusory. I may in this connection refer to article 335, which occurs in Part XVI dealing with Special Provisions relating to certain Classes, which reinforces what I have said above. That Article provides that "the claims of the members of the Scheduled Castes and the Scheduled Tribes shall be taken into consideration, consistently with the maintenance of efficiency of administration, in the making of appointments to services and posts in connection with the affairs of the Union or of a State." Now the scheduled tribes and the scheduled castes are included in the words "backward class of citizens" used in article 16(4). Therefore in considering the claims of, at any rate, a part of, those included in article 16(4) (and I presume the same will apply to the whole) the maintenance of efficiency of administration must be kept in mind, for the reservation provided in article 16(4) is to meet the claims of the members of the 609 scheduled castes and the scheduled tribes. Reservation, therefore, of all appointments or posts or even a majority of them is certain to result in the impairment of efficiency of administration and therefore what I consider as implicit in article 16(4) is borne out also by the provision in article 335. It is in this background that the interpretation of article 16(4) falls to be considered. Turning now to the words in article 16(4), it appears to me that the key words in that Article are "not adequately represented in the services under the State." Obviously, reservation can be made under this Article only if the State comes to the conclusion that any backward class of citizens is not adequately represented in the services under it. If, for example, the State is of opinion that backward classes are adequately represented in the services it can make no reservation under article 16(4). What then is the meaning of these key words in this Article? What these words require is that reservation may be made in order to make the representation of any backward class of citizens adequate in the services. Does the word "adequate" imply only numerical representation in the services or does it imply something more than that? The three meanings of the word "adequate" given in the Shorter Oxford English Dictionary are (i) equal in magnitude and extent; (ii) commensurate in fitness, sufficient, suitable; and (iii) fully representing (logic). It seems to me that it is the second meaning (namely, sufficient) which properly applies to the words "adequately represented" as used in this Article. "Sufficient" has two meanings: (i) Sufficing, adequate, esp. in amount or number to the need, (ii) enough, adequate quantity. Therefore, when article 16(4) says that reservation may be made in order that any backward class of citizens may be adequately represented in the services it means that reservation may be made in order to make the number of any backward class sufficient in the services under the State. These words do not in my opinion convey any idea of quality and can only mean sufficient quantitative representation in the services under the State. If 610 the intention of the Constitution makers was that there may also be reservation in various grades in a particular service where there are grades in the ser vice, I should have expected different words being used in article 16(4) to convey that meaning. These key words used in this Article further convey the idea of representation in the services as a whole, for there are no words which suggest that the service should be broken up in case there are grades in it for the purposes of adequate representation. The conclusion therefore at which I arrive is that these key words convey the idea of adequate numerical representation for any backward class of citizens in a particular service as a whole and it is for this purpose alone that reservation can be made of appointments or posts in the services. This brings me to the question as to bow the reservation is to be made. article 16(4) tells us that it may be made either by reserving appointments to the services or reserving posts in the services. Appointments in my opinion clearly mean the initial appointments to a service, for a person is appointed only once in a service and thereafter there is no further appointment. Therefore, when the Article speaks of reservation of appointments it means reservation of a per centage of initial appointments to the service. Posts refer to the total number of posts in the service and when reservation is by reference to posts it means reservation of a certain percentage of posts out of the total number of posts in the service. The reason why these two methods are mentioned in this Article is also to my mind plain. The method of reservation of appointments would mean that the goal of adequate representation may be reached in a long time. Therefore, in order that the goal. may be reached in a comparatively shorter period of time, the Article also provides for the method of reservation of posts. This will be clear from an example which I may give. Suppose there are 1,000 posts in a particular service and the backward classes have no representation at all in that service. The State considers it necessary that they should have adequate representation in that 611 service. Suppose also that the annual appointments to be made to the service in order to keep it at full strength is thirty. Now the State if it chooses the method of reservation of appointments will reserve a percentage of appointments each year for backward classes. Now suppose that percentage is fixed at ten per century. In order therefore to reach the ten per centum of the total number of posts in the service by the method of reservation of appointments, the period taken would be roughly 34 years. This period may be considered too long and therefore the State may decide to adopt the other way, i.e., the reserva tion of posts; and suppose it is decided to reserve ten per centum of the posts, i.e., 100 in all. It will then be open to the State having reserved 100 posts in this particular service for backward classes to say that till these 100 posts are filled up by backward classes all appointments will go to them provided the minimum qualifications that may be prescribed are fulfilled. Suppose further that it is possible to get annually the requisite number of qualified members of backward classes equal to the annual appointments, the representation of the backward classes will be made adequate in about four years. Once the representation is adequate there will be no power left for making further reservation. Thus by the method of reserva tion of appointments the representation is made adequate in a long period of time while by the method of reserving posts the representation is made adequate in a much shorter period. That seems to be the reason why the Article speaks of reservation of appointments as well as of posts. It is however said that this construction of article 16(4) makes the use of the word "posts" therein superfluous, and that the same result of making the representation adequate quickly could have been achieved if the word "appointments" only had been used therein. I am of opinion that this is not so and the use of the word "appointments" only in article 16(4) would not have made it possible for the State to make the representation of backward classes adequate in a short space of time. In the example I have given the 612 representation of backward classes was made adequate in four years by the method of reservation of posts; it would however not have been possible to make the representation adequate in this hypothetical case in such a short time if the Article only provided for reservation of appointments. I have already said that it is implicit in the Article that reservation cannot be of all appointments or even of a majority of them, for that would completely destroy the fundamental right enshrined in article 16(1) to which article 16(4) is in the nature of a proviso or an exception or at any rate make it practically illusory. Therefore, it would not be open to the State to reserve all or even a majority of the appointments for backward classes, if the word "appointments" only had been used in article 16(4). Even if a larger percentage than ten per centum were reserved for backward classes in the matter of appointments in the hypothetical case given by me it would not be possible to reach the total of 100 posts for the backward classes in the service in less than twice or thrice the time taken by the method of reservation of posts, for the State could not reserve all or even the majority of appointments in any particular year, in view of what is implicit in article 16(4), if the word " a appointments" only had been there. It seems to me therefore that the use of the word "posts" in that Article was with a purpose, namely, that by the method of reservation of posts the inadequate representation may be made adequate within a short space of time and the objection that could be raised to the reservation of all appointments, if only the word "appointments" had been used in the Article, would no longer be available. It cannot therefore be said that on the interpretation I have placed on article 16(4) the use of the word "posts" therein becomes superfluous. I have already said that if the intention was not only to make reservation in the service as a whole whether by the method of reserving appointments or by the method of reserving posts but also to include reservation in various grades in which a service may be divided, the words of article 16(4) would have been different. I may in this connection refer to article 335 613 again, which lays down that the claims of the scheduled castes and the scheduled tribes (which are part of backward classes of citizens) shall be considered So,. , consistently with the maintenance of efficiency of administration. It seems to me that reservation of posts in various grades in the same service is bound to result, for obvious reasons, in deterioration in the efficiency of administration; and reading article 335 along with article 16(4) which to my mind is permissible on the principle of harmonious construction (see Pandit M. section M. Sharma vs Shri Sri Krishna Sinha (1)), it could not be the intention of the Constitution makers that reservation in article 16(4), for at any rate a part of those comprised therein, should result in the impairment of the efficiency of administration. It also seems to me equally obvious that what applies to a part of those comprised in the words "any backward class of citizens" also applies to the whole. Therefore, in the absence of clear words in article 16(4) which would compel one to hold that reservation was meant to apply not only to the service taken as a whole but also to various grades in which the service might be divided, I feel that an interpretation should not be given which would result in the impairment of efficiency of administration, which is jealously safeguarded even when considering the claims of the scheduled castes and the scheduled tribes. I am therefore of opinion that giving the words used in article 16(4) as liberal an interpretation as is possible without destroying or making illusory the fundamental right guaranteed in article 16(1) to which article 16(4) is in the nature of an exception or a proviso, article 16(4) can only mean that the State has the power thereunder to reserve numerically a certain percentage of appointments or posts in the manner I have indicated above and it has no power to split the service into various grades which might exist in it and make reservation in each grade because of the use of the word "posts" therein. I would therefore dismiss the appeal but for different reasons. (1) , 859 60 78 614 AYYANGAR, J. I regret that I cannot share the view of my learned brethren expressed by Gajendragadkar, J. that the appeal should be allowed and I agree with Wanchoo, J. that the appeal should be dismissed and the order of the High Court maintained. The facts of the case have been set out in great detail in the judgments already delivered and it is unnecessary to repeat them. Mr. Chatterji when he opened the appeal appeared to claim that the scope and content of article 16(1) and of sub article (4) thereof were identical and that if article 16(1) guaranteed by the use of the wide expression "matters relating to employment", "equality of opportunity" in relation to promotions also, article 16(4) should be construed to have the same width. But this argument however he abandoned at a later stage. The point therefore does not call for any consideration and the judgments now delivered proceed on the basis that the scope of the limitation on the equality of opportunity which is provided in article 16(4) is not co extensive with the freedom guaranteed by article 16(1). The only question therefore is in what respect is article 16(4) narrower than article 16(1). In considering this the rule of construction should be borne in mind that a restriction on a guaranteed freedom should be narrowly construed so as to afford sufficient scope for the freedom guaranteed. The judgment of the learned Judge now under appeal proceeds on the basis that the expression "Posts" in article 16(4) was a reference to what are termed in service parlance 'ex cadre posts ' and not posts in the service. Mr. Chatterji 's submission was that the learned Judge had no basis for importing the nomenclature and the classifications to be found in Part XIV into Part III dealing with fundamental rights. In particular, Mr. Chatterji quarrelled with the statement by the learned Judge that the expression appointments and posts ' occurring in article 16(4) were "virtually terms of art which had to be interpreted and understood in the light of the legislative history of the constitutional enactments that 615 preceded the Constitution, and in consonance with the scheme that underlies the provisions of the Constitution, which have reference to the civil services ' and civil servants in this country." Mr. Chatterji ' further pointed out that the learned Judge went wrong in observing that "The expressions appointments and posts in article 16(4) have really to be read as appointments to services and appointments to posts" on the ground that the words used in article 16 '4) were merely "appointments and posts" and not "appointments to services" etc. , the latter occurring only in Part XIV. It was,, however, common ground that if the learned Judge was right in considering that "appointments" in article 16(4) meant "appointments to services," the notification now impugned should be held to be unconstitutional. Mr. Chatterji did not dispute that when the expressions 'appointments to services and appointments to posts ' occurred in Ch. XIV vide for instance in articles 309, 311, etc. , being phrases borrowed from statutory provisions of the Government of India Act, 1935, the expression 'appointment to a post ' designated an 'ex cadre post '. The submission, however, of learned Counsel was that there was no justification for importing the phraseology employed in Part XIV in article 16(4), notwithstanding that article 16 dealt with equality of opportunity for employment in the services of the State and sub article (4) was concerned with the reservation of appointments in Services under the State. His submission was that article 16(4) had no legislative precedent in the previous constitutional enactments to justify the importation of service rules and service jargon as an aid to its construction. My learned Brothers have acceded to this submission of Mr. Chatterji. With great respect to them I consider that the view of the learned Judge of the High Court is correct. In the first place, the Article being one concerning the right to be employed in the Services of the State, one has necessarily to turn on the relevant provisions in relation to the Services to discover the precise import of the expressions used in relation to the Services. Besides, we are not left in 616 doubt as to the inter connection between article 16 and Part XIV dealing with Services, because article 335 forms, as it were, the link between Part XIV and the provisions for reservation in favour of the backward communities in article 16(4) Betting out as it does the principles that should guide the State in the matter of reservation in the Services which could obviously be only a reference to that provided for by article 16(4). article 335 runs: "The claims of the members of the Scheduled Castes and Scheduled Tribes shall be taken into consideration, consistently with the maintenance of efficiency of administration, in the making of appointments to services and posts in connection with the affairs of the Union or of a State. " In this Article, at any rate, it cannot be contended, and I did not understand Mr. Chatterji to contend, that 'Posts ' had any reference to 'posts in the services. ' If it were so then in my judgment it would follow that the phraseology employed in this Article which deals with the same subject as that dealt with by article 16(4) throws light on and explains the meaning of the expression 'posts ' in article 16(4). It is only necessary to add that article 320(4) which runs: "Nothing in clause (3) shall require a Public Service Commission to be consulted as respects the manner in which any provision referred to in clause (4) of article 16 may be made or as respects the manner in which effect may be given to the provisions of article 335." to which learned Counsel for the respondent drew our attention indicates, if other indication were necessary., that articles 16(4) and 335 have to be read together and not as if the 'posts ' referred to in article 335 indicated a different idea or connoted a different concept from the same word used in article 16(4). Even if the above view were wrong and the expression 'Posts ' were intended to designate not 'ex cadre posts ' but 'posts in the service, ' I am unable to hold that the appellant derives any advantage. As my learned Brother Wanchoo, J. has pointed out, the crucial words in article 16(4), and which form as it were 617 the key to its interpretation, from which the power of the State to make the reservation stems, are that a class of citizens "is not adequately represented in the Services of the State." The action permitted to be taken to redress this inadequacy is by reservation of appointments and posts. If by the expression 'posts ' are meant 'posts in the service. itself ' I feel unable to attribute to the expression 'posts ' any special significance beyond an appointment to the service. Every appointment in a service must be to "a post" in a service, because there cannot be an appointment in the air but can only be to a "post" in a service. In that sense, in my view, the expression 'post ' would be really redundant unless, of course, as I have said earlier, it meant not posts in a service but ex cadre posts. There is also one other aspect to which I might advert. In some of the top grades there are single posts in the Service. If at any point of time the incumbent is not a member of the backward class, it would certainly be a case of inadequate representation as regards that post which would mean that such posts which are single may be reserved for all time to be held by members of the backward classes, because if at any moment such a person ceases to hold the post there would be inadequate representation in regard to that post. I have drawn attention to this because it pointedly demonstrates that the correct view is that when "inadequacy of representation" is referred to in article 16(4) as justifying a reservation, the only rational and reasonable construction of the words are that it refers to a quantitative deficiency in the representation of the backward classes in the service taken as a whole and not to an inadequate representation at each grade of service or in respect of each post in the service. Besides, even on the footing that "posts" mean posts in the Services, article 16(4) properly construed in the light of article 335 of the Constitution whose inter. action has been discussed in great detail by Wanchoo, J. in the judgment just now pronounced with which entirely agree, contemplates and permits 618 reservation only in respect of appointments to Services at the initial stage and not at each stage even after the appointment has taken place. There is one other matter also which I consider relevant in this context. Under article 16(4) the State is enabled to make provision for the reservation of appointments if in their opinion certain backward classes of citizens are not adequately represented in the Service. The Article therefore contemplates action in relation to and having effect in the future when once the State forms the opinion about the inadequacy of the Service. If an inadequacy exists today, to give retrospective effect to the reservation, as the impugned notification has done, would be to redress an inadequate representation which took place in the past by an order issued today. In my judgment that is not contemplated by the power conferred to reserve which can only mean for the future. As this point however has not been argued I do not desire to rest my judgment on it, but have mentioned it to draw attention to another feature of the notification which deserves consideration. I would therefore dismiss the appeal with costs. By COURT: In accordance with the opinion of the majority the appeal is allowed; the decision of the High Court under appeal is reversed and the respondent 's application for a writ is dismissed. There will be no order as to costs.

This appeal was directed against an order of the Madras High Court issuing a writ of mandamus at the instance of the respondent restraining the appellants from giving effect to two circulars issued by the Railway Board reserving selection posts in Class III of the Railway service in favour of the members of the Scheduled Castes and Scheduled Tribes with retrospective operation. It was urged on behalf of the respondent that the Constitution made a clear distinction between backward classes on the one hand and Scheduled Castes and Scheduled Tribes on the other, and that article 16(4) applied only to reservation of posts at the stage of appointment and not to posts for promotions after appointment and, therefore, the circulars which fell 587 outside the scope of article i6(4) and contravened article i6(1). This was denied by the appellant who pleaded the contrary. The first circular, inter alia, prescribed a quota of reservation for( selection posts and gave retrospective effect to it and the second ' gave guidance and directions as to how the first should be implemented. A subsequent clarification issued by the Board stated that no reversion of staff already promoted to selection posts was contemplated. The High Court held that the expression "backward classes" in article 16(4) included members of the Scheduled Castes and Scheduled Tribes, but that the word ,appointments ' did not denote promotion and the word 'posts ' meant posts outside the civil services and thus the impugned circulars were not covered by article i6(4) and were ultra vires. Held, (per Gajendragadkar, Sarkar, and Das Gupta, JJ.), that the impugned circulars were well within the ambit of article 16(4) Of the Constitution and the appeal must succeed. Articles 16(i) and 16(2) of the Constitution are intended to give effect to article 14 and article 15(1) Of the Constitution and these Articles form parts of the same constitutional code of guarantees and supplement each other. Article 16(i) should, therefore, be construed in a broad and general, and not pedantic and technical way. So construed, "matters relating to employment" cannot mean merely matters prior to the act of appointment nor can 'appointment to any office ' mean merely the initial appointment but must include all matters relating to employment, whether prior or subsequent to the employment, that are either incidental to such employment or form part of its terms and conditions and also include promotion to a selection post. Although Art.16(4), which in substance is an exception to articles 16(1) and 16(2) and should, therefore, be strictly construed, the court cannot in construing it overlook the extreme solicitude shown by the Constitution for the advancement of socially and educationally backward classes of citizens. The scope of article 16(4), though not as extensive as that of article 16(1) and (2), and some of the matters relating to employment such as salary, increment, gratuity, pension and the age of superannuation, must fall outside its non obstante clause, there can be no doubt that it must include appointments and posts in the services. To put a narrower construction on the word 'posts ' would be to defeat the object and the underlying policy ' Article 16(4), therefore, authorises the state to provide for the reservation of appointments as well as selection posts. It is not correct to say that the legislative history of the word 'posts ' shows that it has invariably been used to mean posts outside the services, Neither the relevant provisions of the Constitution nor those of the Constitution Act of 1935 justify such a conclusion. It is the context in which that word is used that must determine its meaning. 588 But in exercising its powers under the Article it should be the duty of the State to harmonise the claims of the backward classes and those of the other employees consistently with the maintenance of an efficient administration as contemplated by article 335 of the Constitution. Per Wanchoo, J. Article 16(4) which is in the nature of an exception or proviso to article 16(1) cannot be allowed to nullify equality of opportunity guaranteed to all citizens by that Article. Article 16(4) implies, as borne out by article 335, that the reservation of appointments or posts for backward classes cannot cover all or even a majority of appointments and posts and the words "not adequately represented", which provide the key to the interpretation of article 16(4), do not convey any idea of quality but mean sufficiency of numerical representation in a particular service, taken not by its grades, but as a whole. Appointments must, therefore, mean initial appointments, and reservation of appointments, the reservation of a percentage of initial appointments. Posts refer to the total number of posts in the service and reservation of posts means reservation of a certain percentage of posts out of total posts in the service. Per Ayyangar, J. Article 16(4), concerned as it is with the right to State employment, has to be read and construed in the light of other provisions relating to services contained in Part XIV of the Constitution and, particularly, article 335. So construed, the word "post" in that Article must mean posts not in the services but posts outside the services. Assuming that was not so, and the word 'posts ' meant posts in the services, the inadequacy of representation sought to be redressed by article 16(4) means quantitative deficiency of representation in a particular service as a whole and not in its grades taken separately, nor in respect of each single post in the service. Read in the light of article 335, article 16(4) can only refer to appointments to the services at the initial stage and not at different stages after the appointment has taken place. Article 16(4) contemplates prospective reservation of appointments and posts and does not authorise retrospective reservation.

Appeal No. 92 of 1961. Appeal by special leave from the judgment and decree dated January 9, 1958, of the Andhra Pradesh High Court in Appeal No. 211 of 1949. K. R. Choudhry, for the appellant. T. V. R. Tatachari, for respondents Nos. 2, 3 and 24 to 27. R. Thiagarajan and P. Ram Reddy, for respondents Nos. 4 to 7 and 17. April 27. The Judgment of the Court was delivered by J. GAJENDRAGADKAR, J. If the appellate decree passed by the High Court makes a variation in the decision of the trial Court under appeal in favour of a party who intends to prefer an appeal against the said appellate decree, can the said decree be said to affirm the decision of the trial court or not under article 133(1) of the Constitution? That is the short question Which arises for our decision in the present appeal. The appellant Tirumalachetti Rajaram filed a suit in forma pauperis in the Court of the Subordinate Judge, Chittoor, for his half share in the properties which once belonged to the joint family consisting of himself and his father and to this suit he impleaded his father and several alienees from him. His case was that the alienations effected by his father as well as the sales held in execution proceedings against his father were not binding on him and so his share in the properties covered by the said alienations was not affected by them. It is on this basis that he claimed his half share in all the said properties. The trial court rejected his contention that the alienations did not bind him, upheld all the alienations and so dismissed his suit. On appeal the High Court of Madras reversed the trial court 's decree in respect of alienations which covered items 2, 10 and 14 in Schedule A as well as item 5 in Schedule B. It held that the alienations in respect of these item,% did not bind the appellant 's share and so a preliminary decree for partition was passed in his favour in respect of the said 455 items. The rest of the decree passed by the trial court was confirmed. The appellant then applied to the High Court for a certificate under article 133(1) of the Constitution. This application was rejected on the ground that the decree sought to be appealed from was one of affirmance and there was no substantial question of law raised by the proposed appeal. In coming to this conclusion the High Court followed an earlier Full Bench decision in Chittam Subba Rao vs Vela Mankanni Chilamayya (1). The appellant then applied for and obtained special leave from this Court, and on his behalf it is urged that the view taken by the Madras High Court in the case of Chittam Subba Rao (1) proceeds on a misconstruction of the relevant clause in article 133(1). That is how the short question which falls to be considered in the present appeal relates to the construction of the said relevant clause in article 133(1). It is common ground that the test of valuation prescribed by article 133(1)(a) is satisfied in this case. Article 133(1) which corresponds to section 110 of the Code of Civil Procedure reads thus: "133(1). An appeal shall lie to the Supreme Court from any judgment, decree or final order in a, civil proceeding of a High Court in the territory of India if the High Court certifies (a) that the amount or value of the subject matter of the dispute in the court of first instance and still in dispute on appeal was and is not less than twenty thousand rupees or such other sum as may be specified in that behalf by Parliament by law; or (b) that the judgment, decree or final order involves directly or indirectly some claim or question respecting property of the like amount or value; or (c) that the case is a fit one for appeal to the Supreme Court; and, where the judgment, decree or final order appealed from affirms the decision of the court immediately below in any case other than a case referred to in sub clause (c), if the High Court further certifies that the appeal involves some substantial question of law." (i) I.L.R.[1953] Mad. i. 456 In the present case we are concerned with the clause "where the judgment, decree or final order appealed from affirms the decision of the court immediately below in any case other than a case referred to in sub. clause (c)". It is common ground that if the appellate a decree of the High Court makes a variation in the decision of the trial court against the intending appellant the appellate decree is not a decree of affirmance but variation, and this position is not affected even if the variation in question is to a very small extent and may be of very minor significance. The decisions of the High Courts, however, show a sharp conflict in regard to the question as to the character of the appellate decree where it makes a variation in favour of the intending appellant. Broadly stated the majority of the High Courts have taken the view that an appellate decree which makes a variation in favour of the intending appellant is a decree of affirmance and it is only the Punjab High Court and the majority decision of the Patna High Court which have taken a contrary view. The decisions of different High Courts bearing on this point show that the learned Judges did not always try so much to construe the terms of the relevant constitutional provision as to reconcile their earlier decisions which disclosed a different approach and a tendency to reach different conclusions. Indeed, on occasions some judgments have expressed the hope that the sharp conflict of judicial opinion resulting from the difference in approach adopted in dealing with the problem can be effectively resolved only when this Court considers the matter and makes its authoritative pronouncement. Thus it would be clear that though this important question lies within a narrow compass it is not free from difficulty. In dealing with this question we think the best course to adopt would be to consider the problem of construction without reference to the previous decisions on the point, and in construing the relevant clause it is obviously necessary to bear in mind that the clause under discussion deals with the constitutional right of the litigant to make an appeal to this Court; and so it would be inappropriate to adopt a 457 technical or pedantic approach in interpreting the material words used in the relevant clause. Reading the clause as a whole and giving the material words their plain grammatical meaning it seems prima facie to show that the test of affirmance prescribed by the clause can best be satisfied if we take the appellate decree in its entirety and enquire whether the said decree affirms the decision of the trial court considered, in its entirety. It is a matter of comparing the appellate decree with the decision of the trial court under appeal. If the appellate decree affirms the decree of the trial court it is a decree of affirmance; if there is a variation made by the appellate decree in the decision of the trial court the appellate decree is not a decree of affirmance and this position would not be affected whether the variation is made in favour of the intending appellant or against him and whether the variation made is minor or major. It is, however, urged that the words "judgment, decree or final order appealed from" denote that part of the judgment, decree or final order in appeal which is intended to be challenged in the proposed appeal to this Court. In other words, the word "decree" it is suggested, refers to the part of the decree under appeal. On this construction a decree has to be split up into different parts and the words "appealed from" have to be treated as words of limitation. The argument in a slightly different form has also been pressed before us. It is suggested that in cases where different causes of action and different claims and reliefs have been combined different decrees are in fact passed though in form there may be one paper on which one decree is drawn; and so it is argued that the decree appealed from must mean the decree under appeal dealing with the subject matter or matter in dispute proposed to be brought to this Court by the intending appellant. For one thing this argument may not be available where there is only one cause of action, and it is quite clear that the word "decree" must have one meaning applicable to all cases. Besides, in our opinion, this construction on which the argument is based is far too technical and artificial and cannot be 458 regarded as reasonable. Normally, in each suit there is one decree, and so it would be inconsistent with the scheme of the Code to divide the decree into several parts by reference to its relation to different claims or subject matters or to treat one single decree as consisting in fact of several decrees. The normal, natural and reasonable construction to place on the first part of the relevant clause is to hold that it refers not merely to that part of the decree which is sought to be challenged in the appeal but the entire decree from which the appeal arises or the decree giving rise to the appeal. On this construction the clause "appealed from" is not a clause of limitation. It is merely a descriptive clause and it describes the decree as one from which the appeal arises. If that be so, in deter mining the character of the decree it would be necessary to take the decree as a whole and enquire whether it is a decree of affirmance or not. In support of the argument that there can be more decrees than one in a suit which combines different causes of action and different claims made against different defendants in respect of different subject matters Mr. Tatachari, for the respondent, has relied on the decision of the Calcutta High Court in Dhirendra Nath Sarkar vs Nischintapore Company (1). In that case the Court was dealing with a decree which was made in favour of the plaintiffs for the recovery of arrears of rent in respect of three tenancies held by three different tenants and the question raised was one of limitation under article 182, cl. (5) of the Limitation Act (IX of 1908). The court held that although the decree was passed in one suit and was set out on one sheet of paper the position was precisely the same as if the plaintiffs had brought three distinct suits against the defendants and had obtained three different decrees. It appears that the decree holder 's claim for execution was in time in respect of one of the tenants but not in respect of the two others; but he urged that since the decree was one it was not open to the two other tenants to plead limitation by splitting up the decree into three different decrees and by seeking to 459 invoke the provisions of article 182, cl. (5) severally as against each one of the said decrees. This argument was rejected and it was held that under explanation (1) to article 182 the decree holder 's application for execution was barred by limitation in respect of the said two tenancies. It would thus be clear that the discussion about the character of the decree and the conclusion that though in form there was one decree in fact and law the decrees were three are based on the provisions of explanation (1) and so must be confined to the said explanation. Explanation (1) provides that where the decree or order has been passed severally in favour of more persons than one distinguishing portions of the subject matter as payable or deliverable to each, the application mentioned in cl. (5) of article 182 shall take effect in favour only of such of the said persons or their representatives as it may be made by. But where the decree or order has been passed jointly in favour of more persons than one, such application, if made by any one or more of them, or by his or their representative, shall take effect in favour of them all. The facts in the case of Dhirendra Nath Sarkar (1) were converse of the case contemplated by the first part of explanation (1), and so the principle laid down by the said part of explanation (1) was applied and it was held that in respect of the two tenancies the decree holder 's application for execution was barred by article 182, cl. It would be idle to contend that considerations which are relevant and material under explanation (1) are of such a general application as to support the plea that in a suit where different causes of action are included and different reliefs are claimed against different individuals several decrees are passed and not one. There are cases in which more than one decree can be and are passed under the Code of Civil Procedure, for instance cases where preliminary decrees are passed, but the normal rule is one decree is passed in one suit and so we are not prepared to accede to the argument that the first part of the relevant clause of article 133(1) should be read on the basis that every decree passed in a suit should be held to be a (1) ; 22 C.W.N. 192. 460 composite decree made up of several decrees in respect of several claims or reliefs and that the decree appealed from is only that particular decree which is proposed to be brought in appeal to this Court. The next question to consider is: what is the denotation of the word "decision" used in the said clause. The argument for the respondent is that the word "decision" does not mean the whole of the decision but the decision on that part of the controversy between the parties which is brought to this Court in appeal. In support of the argument that the decision does not mean the entire decision of the trial court reliance is placed on the provisions of O. 20, rr. 4 and 5. Rule 4 of O. 20 deals with the judgments of Small Cause Courts and judgments of other Courts, and it provides that the judgments falling under the first clause need not contain more than the points for determination and decision thereon, whereas the judgments falling under the latter class should contain a concise statement of the case, the points for determination, the decision thereon and the reasons for such decision. There is no doubt that the decision in the context means the decision on the points for determination. That of course is the meaning of the word "decision", but whether or not the word "decision" means the decision on one point or the decision of the whole suit comprising of all the points in dispute between the parties must inevitably depend upon the context, and the context is plainly inconsistent with the argument that the decision should mean the decision on a specific point. If the word "decree" in the first part of the relevant clause means not a part of the decree but the whole of the decree then it would be reasonable to hold that the word "decision" must likewise mean the entire decision of the trial court and not a part of it. Then it is urged that O. 41, r. 33 seems to contemplate that there can be an appeal against a part only of the decree and so the word "decree" in the first part of the relevant clause may well mean a part of the decree under appeal. It is true that under the interpretation clause in section 2 the word "decree" means, 461 inter alia, the formal expression of an adjudication, which conclusively determines the rights of parties with regard to all or any of the matters in controversy in suit, and it is also true that a party aggrieved by a decree may appeal only against a part of it and is not bound to file an appeal against the whole of the decree; but we do not see how this can assist the respondent in contending that the word "decree" must,, mean a part of the decree when the context clearly speaks to the contrary. Therefore, we are inclined to hold that both "the decree" and "the decision" referred to in the clause mean the decree and the decision respectively taken as a whole and not in part. The question as to the meaning of the word "decision" in the corresponding provision of the Code of 1882 (section 596) was considered by the Privy Council in Rajah Tasadduq Rasul Khan vs Manik Chand (1). The question which arose for the decision of the Privy Council was whether the appellate decree in that case was one of affirmance or not. Tile appellate decree had confirmed the trial court 's decision though on different grounds, and so it was urged that the appellate decree was not one of affirmance. In rejecting this argument the Privy Council stated that "the natural, obvious and prima facie meaning of the word "decision" is decision of the suit by the Court, and that meaning should be given to it in the section" (section 596). The Privy Council examined the definition of the word "judgment" in the Code of 1882 and came to the conclusion that the word "decision" meant the decision of the suit by the trial court and not the grounds stated in support of the said decision; in the result it was held that the appellate decree which confirmed the decision of the trial court though on different grounds was in law a decree of affirmance. It would thus be seen that this decision undoubtedly supports the conclusion that the word "decision" in article 133(1) should mean not a part of the decision or the grounds given for it but the decision of the suit as a whole; and if that be so, the clause could be harmoniously construed to mean that in determining the character of the appellate decree we have to look at the appellate decree as (1) [1902] L.R. 30 I.A. 35. 162 a whole, compare it with the decision of the trial court as a whole and decide whether the appellate decree is one of affirmance or not. In this enquiry the nature of the variation made whether it is in favour of the intending appellant or otherwise would not be relevant. It is then argued that this construction is inconsistent with the provision made by article 133(1)(a) in regard to the value of the subject matter of the dispute. There is no doubt that in applying the test of the value of the subject matter of the dispute what we have to consider is the dispute in the Court of First Instance and the dispute on appeal. In other words, the value of the subject matter has to be determined by reference to the subject matter which is actually the subject matter of the proposed appeal to this Court. The argument is that if for determining the value of the subject matter it is necessary to consider only that part of the decree and subject matter which are actually proposed to be brought to this Court in appeal, in interpreting the word 'decree" in the relevant clause a similar approach should be adopted and only that part of the decree should be considered which is proposed to be brought to this Court in appeal. We do not see the materiality of this consideration nor even its relevance. The test prescribed by article 133(1)(a) is an independent additional test and its effect has to be judged by interpreting the words used by the relevant clause. If the said clause refers to the amount of the value of the subject matter still in dispute on appeal quite plainly we must take into account only the subject matter in dispute in appeal and nothing more. The words used in this connection are clear and unambiguous but they cannot reasonably control the meaning of the word "decree" in the relevant clause which provides for an additional and an independent condition. Therefore, in our opinion, the argument based on the construction of article 133(1)(a) is not well founded. The same comment falls to be made in regard to the other argument based on the provision which requires the High Court further to certify that the 463 appeal involves some substantial question of law. It is urged that this requirement has to be satisfied by reference to that portion of the decree which is proposed to be brought to this Court under appeal and that would suggest that even the test of affirmance should be applied by reference to the part of the decree under appeal and not by reference to the whole of the appellate decree. Here again, the words used are that the appeal involves some substantial question of law which must necessarily mean the appeal as it is proposed to be brought and that must refer only to the decree brought under appeal. Therefore, even this argument does not afford material assistance in construing the relevant clause with which we are concerned. There is yet another argument which must be examined, It is contended that the adoption of the literal construction of the relevant clause relating to affirmance would lead to anamolous and unreasonable consequences. It is pointed out that if the decision of the trial court is wholly confirmed the intending appellant would not be entitled to come to this Court as a matter of right unless there is a substantial question of law. On the literal construction, however, he would be entitled to come to this Court even if there is a very minor and slight modification in the decision of the trial court and that too in his favour. Prima facie it may no doubt seem somewhat unreasonable that even a slight modification made in the decision should give the intending appellant the right to come to this Court; but, on the other hand, even this position cannot be regarded as unreasonable because it would really be found to be consistent with the principle underlying the doctrine of affirmance. What is the basic idea underlying the relevant provision? If two courts which have judged the dispute between the parties and applied their independent minds to it agree in their conclusions the appellate decision is one of affirmance and unless there is a substantial question of law no further right to appeal should lie. That is the basis of the provision. When, however, a variation is made by the appellate court it tends to 464 show that the two courts have not entirely agreed and so it is not a case of affirmance. The extent of the difference does not matter so much as the fact that there is a difference in the result, and go in prescribing the doctrine of affirmance the Constitution makers may well have intended that the said doctrine should be confined only to cases where there is a complete affirmance and not to cases of partial affirmance. We do not think that the consequence of the view we are inclined to take can be reasonably charac terised as opposed to common sense. Besides, if on a fair and reasonable construction the words used in the relevant clause lead to the conclusion which we are inclined to draw it would be unreasonable to limit the scope of the said words on hypothetical considerations of unreasonable consequences. As we have already observed we are dealing with a constitutional right conferred on litigants, and, unless the limitation contended for by the respondent can be said to flow reasonably from the words used in the relevant clause, it would not be open to us to adopt that limited construction merely on such hypothetical considerations. Then it is urged that the majority of the High Courts in India have taken the same view which the Madras High Court has taken in the present case and so we should be slow to interfere with the majority decision. In support of this conclusion the principle of stare decisis is pressed into service. We are not impressed by this argument. It is perfectly true that in construing the clause we would carefully have to bear in mind the views expressed by the majority of our High Courts, but as we have already indicated there is a sharp conflict of opinion on this point and it can be stated generally that in almost all the High. Courts different views have been expressed at one time or the other. Besides, it would be singularly inappropriate to invoke the doctrine of stare decisis in a case of this kind where High Courts have differed and the matter has been brought to this Court for resolving the said difference of opinion. In such a case it is open to us, and indeed it is our duty, to construe the relevant clause and decide which of the two 465 conflicting views should hereafter prevail. Therefore the argument based on the practice prevailing in the majority of the High Courts in this country is not of much assistance. At this stage we may deal with another argument urged by Mr. Rama Reddy who appeared for some of the respondents. He contends that in construing the relevant clause we may have regard to the fact that, the Constitution intended to restrict the right of the ' appellant to come to this Court and not to widen it. In support of this argument be relies on the fact that the value of the subject matter prescribed by article 133(1)(a) is now made Rs. 20,000 whereas formerly it was Rs. 10,000, and he also relies on the provisions of article 133(3) under which no appeal shall lie to the Supreme Court from the judgment, decree or final order of one judge of a High Court. In our opinion, there is no substance in this contention. It is well known that in raising the amount of the value of the subject matter article 133 (1) (a) has merely partially recognised the fall in the price of the rupee and so it cannot be read as showing the intention to restrict the appellant 's right in any manner. In regard to the provisions of article 133(3) there is no material change made by the Constitution since the position under section III of the Code of 1908 as well as section 597 of the Code of 1882 was substantially the same. We would accordingly hold that in determining the question as to whether the appellate decree passed by the High Court affirmed the decision of the trial court the appellate decree must be considered as a whole in relation to the decision of the trial court similarly considered as a whole. That is the proper approach in applying the test of affirmance. If there is a variation made in the appellate decree in the decision of the trial court it is not a decree of affirmance and this is not affected either by the extent of the variation made or by the fact that the variation is made in favour of the intending appellant and not against him. In this connection it would be interesting to refer to three decisions which afford judicial background for 466 the controversy that has been agitated in the several High Courts for so many years past. In Raja Sree Nath Roy Bahadur vs The Secretary of State for India in Council (1) a Full Bench of the Calcutta High Court had occasion to consider the effect of the relevant provisions of section 596 of the Code of 1882. In a land acquisition case the applicant had claimed a sum of Rs. 77,000 odd as the value of his land. The Collector had assessed the value at Rs. 28,287. On a reference the judge upheld the Collector 's award. The applicant then moved the High Court by appeal and in his appeal he valued his claim at Rs. 49,000. The High Court partially allowed the appeal and granted him an additional sum of Rs. 7,000. The applicant then applied for leave to appeal to the Privy Council and urged that the decree passed by the High Court on appeal was not a decree of affirmance and since the test of the value of the subject matter was satisfied be was entitled to go to the Privy Council. This application was rejected by the High Court. "The appellant desires", observed Maclean, C. J., "to appeal only against the decision of this Court so far as it affirmed the decision of the court below, nothing else. This seems to be, in substance, as far as the subject of the appeal goes, a decree of affirmance". The learned Chief Justice also added that whilst the decree of the High Court modified in the petitioner 's favour the original decree, as regards the subject matter of the proposed appeal to His Majesty in Council it most certainly affirmed the decree of the first court. This judgment was pronounced in 1904; and the construction which it put on the relevant clause of section 596 is in conformity with the views for which the respondents contend in the present appeal. The same point was raised before the Privy Council in Annapurnabai vs Ruprao (2). In that case the plaintiff who claimed to have been adopted by the senior widow of Shanker Rao sued the junior widow of Shanker Rao (defendant 1) as well as the person who claimed to have been adopted by her (defendant 2) for possession of half the property of Shanker Rao. (1) (2) (1924) L.R. 51 I.A. 319. 467 Both the defendants denied the plaintiff 's adoption land set up the adoption of defendant 2. The trial court held that the plaintiff 's adoption had been proved and that the alleged adoption of defendant 2 had not been proved. It, however, found that the plaintiff was bound to provide maintenance for defendant I at the rate of Rs. 800 per annum. Defendant I had in that behalf claimed Rs., 3,000 per annum for( her maintenance out of the estate. Upon appeal by the defendants to the Court of the Judicial Commissioner the trial court 's decree was modified by increasing the maintenance from Rs. 800 to Rs. 1,200 per annum. In other respects the decree was affirmed. The defendants then applied to the Court of the Judicial Commissioner for leave to appeal to the Privy Council. Their argument that they were entitled to appeal to the Privy Council was rejected on the ground that the appellate decree was one of affirmance, and that a small change made by it in favour of the defendants did not affect that position. It was this decision which was challenged before the Privy Council. Lord Dunedin, who delivered a very short judgment on behalf of the Board, stated that in the opinion of their Lordships the contention of the petitioners ' coun sel as to the effect of section 110 of the Code of Civil Proce dure is correct, and the petitioners had a right of appeal. In other words, this decision clearly shows that though the trial court 's decision had been varied to some extent in favour of the intending appellants it was held that the appellate decree was not one of affirmance and so the intending appellants were entitled to obtain leave to appeal to the Privy Council. It does appear that the appellants in that case confined their appeal only to the amount of maintenance having regard to the concurrent findings made by the courts below in respect of other matters; and so the special leave granted to them was limited to the question of the said maintenance allowance. That, however, had nothing to do with the decision of the Privy Council as to the character of the appellate decree. The appellants did not want to agitate the other points and asked for permission to limit their appeal only to 468 the question of their maintenance; that is about all. Thus it is clear that the decision of the Privy Council in that case construed the relevant provisions of section 110 literally and held that if the appellate decree makes any variation in the decision of the trial court may be in favour of the intending appellant it is not a decree of affirmance and the intending appellant was entitled to go to the Privy Council in appeal. It is true that the judgment does not purport to discuss the question of construction but the conclusion has been emphatically recorded and there can be no doubt that conclusion proceeds on the literal construction of section 110 of the Code. This judgment was pronounced in 1924. Three years later the same question arose before the Calcutta High Court in Narendra Lal Das Chaudhury vs Gopendra Lal Das Chaudhury (1). In that case the intending appellant had brought a suit for partition of the joint family property valued at Rs. 10,00,000. A preliminary decree was passed against which an appeal was brought to the High Court. It appeared that the first question which the plaintiff appellant raised was that the preliminary decree had given him a smaller share in the property than what he was entitled to get. This contention was upheld by the High Court and in consequence his share was increased. In that respect the High Court reversed the finding of the trial Court. On other points raised by the plaintiff appellant the High Court confirmed the judgment of the trial court. It was against this appellate decision that an application was made for leave to go to the Privy Council; and it was urged that as a result of the decision of the Privy Council in Annapurnabai 's case (2) the appellant was entitled to obtain leave; and that squarely raised the question about the effect of the decision in Annapurnabai 's case (2). Chief Justice Rankin took the view that the only effect of the said decision was to reverse the conclusion of the Calcutta High Court in Raja Sree Nath Roy 's case (3) and nothing more. "It appears to me", observed the learned Chief (1) A.I.R. 1927 Cal. 543. (2) (1924) L.R. 51 I.A. 319. (3) 469 Justice, "that the case of Annapurnabai (1) is not in itself a sufficient authority to justify this Court in abandoning the principle which it has with other High Courts acted upon; that is to say, I do not think that it shows that it is an erroneous view that we have to look to the substance and see what is the subject matter of the appeal to His Majesty in Council". The learned Judge then proceeded to express his doubt as, to whether "in the end even that principle would be found to be in accordance with the construction to be put upon section 110", but he added, "this Court and other High Courts have for many years acted upon that principle and I am not prepared to accept the case of Annapurnabai a,; going further than this that where there is a dispute as to the amount of decree or as to the amount of damages the reasoning of Raja Sree Nath Roy 's case (2) is not a correct application of that principle". "We may take it", said the learned Chief Justice, "that where the amount is a question in dispute the fact that the courts differ and that the higher court differs in favour of the applicant does not mean that the decision is one of affirmance, but I am not, in a case of this kind, prepared to say that because on a totally different point, namely, a point about the share, the applicant has succeeded and succeeded altogether so that he has no further grievance in that matter, he can without showing a substantial question of law have a right to litigate upon other points upon which both the courts have been in agreement". It is the interpretation thus put by Chief Justice Rankin on the decision in the case of Annapurnabai (1) that subsequently became the starting point of elaborate discussion in which legal subtlety was pressed into service and distinction was made between action arising on a single cause of action and giving rise to a single claim and actions in which different causes of actions were combined against different persons and different reliefs were claimed. As we have just indicated, the learned Chief Justice undoubtedly entertained a doubt as to the correctness of the test of substance which was then applied by some of the High (1) (1924) L.R. 51 I.A. 319 (2) 60 417O Courts in interpreting the provisions of section 110 of the Code. One feels tempted to observe with respect that if the learned Chief Justice had examined the question of construction afresh without reference to the prevailing practice or the decisions already pronounced by Indian High Courts he might have adopted the literal construction of section 110 and in that event perhaps all controversies that subsequently arose may have 'been avoided. It now remains to indicate very briefly the position taken by different High Courts in this controversy. In Chittam Subba Rao vs Vela Mankanni Chelamayya (1) a Full Bench of the Madras High Court was constituted to deal with this point because reported decisions of the said Court showed a difference of approach and a conflict of opinion. Rajamannar, C.J., who delivered the judgment of the Full Bench, carefully examined the previous decisions of the Court and evolved three principles to govern the decision of the point. These principles have been stated in the judgment thus (i) If the judgment or decree of the High Court varies the decision of the lower court in respect of a matter in controversy in the proposed appeal to the Privy Council, then there is a right of appeal not only to the person against whom the variation has been made, but even to the party in whose favour the variation has been made. But it is necessary that the matter in respect of which there has been a variation should be the subject matter of the proposed appeal to the Privy Council. (ii) A matter in controversy cannot be split up or analysed or dissected into component parts or arbitrary divisions. The true test will be to determine the nature of the dispute or controversy. (iii) If the matter in respect of which there has been a variation is not the subject matter of the proposed appeal, then such variation would not confer a right of appeal as regards matters unconnected with the matter in respect of which there has been a variation. Ex hypothesi, this will be the case when the variation has been completely in favour of the applicant. (1) I.L.R. [1953] mad. 1. 471 Having evolved these principles the learned Chief justice observed that every one of the decisions cited before the Court can be justified by an application of the principles thus set up. It is evident from the judgment that the task which the Full Bench attempted to achieve was one of reconciling the different expressions of opinion found in the reported decisions of the Court. In doing so more attention has naturally been paid to the said decisions and the reasons on which they were based than to the words used in article 133 itself. In regard to the said Article the lear ned Chief Justice has observed that courts cannot add to the language actually employed and thus give an unwarranted extension to the scope of the statutory provision. "At the same time, I do not think", observed the learned Chief Justice, "that the letter of the statutory provisions should compel a Court to an unreasonable construction if it is possible to take a reasonable view by taking the letter of the provision along with its substance". Assuming that this principle can be legitimately invoked in construing a con stitutional right of making an appeal it must be borne in mind that hypothetical considerations about unreasonable consequences would not justify the imposition of a strained meaning on the relevant words used in the Article. If in discussing the problem we first begin with the enquiry as to what would be reasonable, and having reached a conclusion in that behalf on a priori consideration if we seek to import that conclusion on the words used in article 133 that would not be a proper approach to adopt. The proper approach to adopt would be to take the material words as they occur in article 133 and construe them fairly and reasonably. We have already indicated our conclusion on a fair and reasonable construction of the clause. The Madras decision no doubt attempted to find principles on which its previous decisions could be explained and has in fact evolved three such principles. Even if these principles are assumed to be logical and consistent with each other and even if they are assumed to explain the earlier decisions of the Court it does not follow that the said principles can 472 be legitimately assimilated within the scope of the Article because it seems to us that unless words are added in the Article and the meaning of the words used is unduly strained it would be difficult to justify the said principles as flowing from the said Article. This Madras view has been applied by the Andhra High Court in V. Lakshminarayana Sastry vs V. Sitaramma Sastry (1). The majority 'judgment of the Allahabad High Court in Rani Fateh Kunwar vs Raja Durbijai Singh( ') which in fact preceded the Madras decision has adopted substantially the same approach and has come to the same conclusion. Mr. Justice Bhargava, who agreed with the majority decision, has, however, placed his conclusions on grounds similar to those which we have adopted. To the same effect are the decisions of the Assam, Bombay, Mysore and Nagpur High Courts (vide: G. C. Bardoloi vs Collector of Kamrup (3), Kapurji Magniram vs Pannaji Debichand (4), Govind Dhondu Kulkarni vs Vishnu Keshav Kulkarni(5) Kanakarathnammal vs V. section Loganatha Mudaliar(6) Ramchandra vs Ganpati (7). The Calcutta High Court has generally adopted the view taken by vs Rankin, C. J., but as its decision in Probodh Chandra Roy vs Hara Hari Roy (8), shows the practice in the Calcutta High Court appears to be to treat the point as one of doubt and as Chief Justice Chakravarti has observed "where there is a doubt I would resolve it by deciding in favour of the applicant and granting him leave". On the other hand, the Full Bench decision of the Punjab High Court in Union of India vs Kanahaya Lal Sham Lal (9) and the majority decision of the Patna High Court in Kanak Sunder vs Ram Lakhan have taken the view which we have adopted. Before we part with this appeal we would like to make it clear that if an appellate decree confirms the decision of the trial court but merely makes a variation in regard to the order as to costs such a variation (1) A.I.R. 1959 Andh. (2) I.L.R. [1952] 2 All. (3) A.I.R. 1952 Ass. (4) 31 B.L.R. 619, S.C.; A.I.R. 1929 Bom. (5) I.L.R. (6) A.I.R. 1959 MYS. (7) I.L.R. (8) A.I.R. 1954 Cal. (9) I.L.R. [1957] Punj. (10) I.L.R, [1956] 35 Pat. 499. 473 would not affect the character of the decree which would in law amount to a decree of affirmance, whether the variation as to costs is made in favour of one party or the other. The position with regard to interest, however, is different; for instance, in regard to a claim for interest before the date of the decree which is a part of the dispute between the parties if the appellate court makes a variation in respect of the award, of interest that would affect the character of the appellate decree. Unlike the order of costs which is entirely in the discretion of the Court under section 35 of the Code of Civil Procedure an order as to interest which the Court can make under section 34 of the Code forms part of a dispute between the parties, and in that sense if a variation is made in regard to it is an integral part of the decision or the decree. In this connection it may also be necessary to make it clear that if the appeal court makes a variation in the decision of the trial court either because a concession has been made in that behalf or the variation has been obtained by parties by consent or a part of the subject matter covered by the decree has been withdrawn such variation cannot affect the character of the appellate decree. The principle of affirmance on which the provision rests postulates either affirmance or variation by the appeal court as an act of adjudication and that necessarily means the decision. of the appeal court on the merits. The result is the appeal must be allowed, the order passed by the High Court by which the appellant 's application for certificate has been refused must be set aside and the matter sent back to the High Court for disposal in accordance with law. Parties to bear their own hearing costs but the respondent to pay the cost of court fees which the appellant would have had to pay if he had not been allowed to appeal as a pauper. Appeal allowed.

The appellant brought a suit for the recovery of his moiety share of the joint family properties against his father and alienees from the latter and his case was that the alienations made by the father were not binding on his share of the properties. The trial court dismissed the suit but the High Court on appeal reversed the decision of the trial court in respect of some of the properties, passed a preliminary decree for partition of those properties and confirmed the rest of the decree of the trial court. The appellant applied for a certificate under article 133(1) Of the Constitution but the High Court rejected the same holding that the decree was one of affirmance and involved no substantial 453 question of law, following a decision of the Full Bench of that Court in Chittam Subba Rao vs Vela Mankanni Chellamayya. The case admittedly satisfied the test of valuation prescribed by article 133(1)(a). Held, that in construing the relevant clause of article 133(1) of the Constitution, which gives a constitutional right to the litigant to appeal to this Court, it would be inappropriate to adopt a technical or pendantic approach and the clause must be read as a whole and its material words given their plain grammatical meaning. So construed, the correct test to determine whether an appellate decree affirmed the decision of the court below would be to compare the appellate decree, taken in its entirety, with the decision of the trial court taken as a whole. If on such comparison it was found to do so, it was a decree of affirmance; but if it made a variation, whether for or against the appellant, it would be a decree of variation, the extent of the variation being wholly immaterial. Chittam Subba Rao vs Vela Mankanni Chelamayya, I.L.R. [1953] Mad. i, disapproved. The words "appealed from" in the last part of article 133(1) are not words of limitation, and they do not refer to a part of the decree, that may be under appeal, but simply describe the decree viewed as a whole. So also the word "decision" therein means the decision of the trial court as a whole and not the decision on any point falling for determination. Rajah Tasadduq Rasul Khan vs Manik Chand, (1902) L.R. 30 I.A. 35, referred to. Dhirendra Nath Sarkar vs Nischintapore Company, , held inapplicable. The test in respect of value laid down by article 133(1)(a) is an independent condition that cannot control the meaning of the word 'decree ' in the last part of article 133(1), which provides for another additional and independent condition. Raja Sree Nath Roy Bahadur vs The Secretary of State for India in Council, , Annapurnabai vs Ruprao (1924) L.R. 51 I.A. 319 and Narendra Lal Das Chaudhury vs Gopendya Lal Das Chaudhury, A.I.R. 1927 Cal. 543, considered. Case law reviewed. While any variation of the order as to costs, which is in the discretion of the Court under section 35 of the Code of Civil Procedure, cannot change the character of the appellate decree which is otherwise one of affirmance, variation of the order as to interest under section 34 of the Code must affect its character. Any variation by concession or consent of parties or withdrawal of part of the subject matter of the decree cannot, however, affect its character. 58 454

Appeal No. 104 of 1959. Appeal by special leave from the judgment and decree dated December 19, 1956, of the Patna High Court in Appeal from the Appellate Decree No. 632 of 1949. M. C. Setalvad, Attorney General of India and R. C. Prasad, for the appellants. section P. Varma, for respondent No. 1. N. section Bindra and D. Gupta, for Intervener. April 27. The Judgment of Sinha, C. J., Sarkar and Mudholkar, JJ., was delivered by Sarkar, J. The judgment of Das Gupta and Ayyangar, JJ., was delivered by Ayyangar, J. SARKAR, J. The parties to this litigation are all Hindus but it is not in dispute that the Mohammedan law of preemption is applicable to them by custom, nor that the appellants had a right of preemption. The only question is whether the first demand called talab i mowasibat which has to be made after the completion of the sale in order that the right may be enforced, was made before or after such completion. The making of the demand is not in dispute but the dispute is as to when the sale was completed. The appellants had their residential house contiguous to the house owned by certain persons whom we may call Pandeys. On January 31, 1946, the Pandeys executed a deed of sale in favour of the respondent purchaser in respect of their aforesaid house. The appellants claim a right of are emption on account of this sale. The consideration mentioned in the deed was Rs. 2,000. There was a subsisting mortgage on that house and the deed provided that out of the consideration a sum of Rs. 200 would be left with 476 the respondent purchaser for clearing off that mortgage. The deed also recited that the Pandeys had received Rs. 400 and "the remaining Rs 1,400 (Rupees fourteen hundred) in cash at the time of exchange of equivalents, (that is) at the time of (handing over) of the receipt of this deed. . . On receipt of the whole and entire amount of consideration money we have put the said claimant into possession and occupation of this vended property as absolute owner in place of us, the executants and our heirs and representatives. " The deed further stated, "this sale deed becomes operative from the date when we the executants affixed our signatures thereon. Whatever title, we, the executants and our heirs had. . . with respect to this vended property, has become extinct, inoperative and null and void and the same has now been transferred to and acquired by the claimant. " By the word "claimant", the respondent purchaser was referred to. The deed was presented at the registration office for registration by the Pandeys on the day it was executed and it was left with the Registrar in the Registration Office for the necessary entries and copies being made, a receipt being given to the Pandeys. On February 2, 1946, the appellants on coming to hear of the execution of the deed of sale made the talab imowasibat. On February 7, 1946, the receipt granted by the Registration Office to the Pandeys was made over by them to the respondent purchaser who there upon paid the balance of the price as stipulated in the deed. On February 9, 1946, the documents were copied in the Registrar 's books and thereupon the registration became complete as provided in B. 61 of the . The respondent purchaser thereafter received the deed of sale from the Registrar 's Office on February 13, 1946. The appellants filed their suit for preemption on September 9, 1946. The suit was decreed by the trial court and this decision was maintained by the first Appellate Court. The High Court, however, in second appeal set aside the decisions of the Courts below with the result that the suit stood dismissed and 477 the appellants have now come to this Court in further appeal. The Mohammedan law of preemption is stated in Mulla 's Principles of Mohammedan law in these terms: "The right of preemption arises only out of a valid, complete and bona fide sale. " This statement of the law is accepted by both the parties and there is no question that it is not correct. There is furthermore no dispute that the sale to the respondent purchaser was valid and bona fide. It is also agreed that one of the requisites before the right of pre emption can be exercised is the preliminary demand by the preemptor and that such demand must be made after the completion of the sale. The case has been argued before us on behalf of the appellants on the basis that the sale was governed by the . We will also proceed on that basis. Section 54 of the provides that sale of tangible immovable property of the value of rupees 100 and upwards, which the house with which we are concerned is, can be made only by a registered instrument. Section 3 of this Act defines " registered" as registered under the law for the time being in force regulating the registration of documents. This, in the present case, means the Regis tration Act of 1908. It is not in dispute that the registration under the is not complete till the document to be registered has been, copied out in the records of the Registration Office as provided in section 61 of that Act. It was therefore con. tended in the High Court that when a sale had to be made by a registered instrument it became complete only on the instrument of sale being copied in the books of the Registration Office. The High Court accepted this view and held that the sale in the pre sent case, therefore, became complete on the completion of the registration of the instrument of sale which was done on February 9, 1946 when the instrument was copied out in the books of the Registration Office. In this view of the matter, the High Court 61 478 came to the conclusion that the appellants were not entitled to enforce their right of preemption because they had not made the preliminary demand after the completion of the sale as the law required them to do, but before, that is, on February 2, 1946. In answer to this view of the High Court, the learned Attorney General appearing for the appellants says that the High Court overlooked section 47 of the the effect of which was to make a registered document operate from the time from which it would have commenced to operate if no registration thereof had been required and not from the time of its registration. His contention is that once a document is registered, as the deed of sale in this case was, it begins to operate from the time it would have otherwise operated and therefore, the position in this case is that the sale became operative and hence complete on January 31, 1946. The learned Attorney General further contends that the proper construction of the deed of sale was that it became operative from the day it was executed and that if it was not so, it was not a sale but could only be an agreement to sell in which latter case his clients, though this present suit might fail, would be entitled, if they so desired, to enforce their right of preemption when the sale was completed in pursuance of that agreement. As authority in support of his contention that in view of section 47 of the the sale in the present case must be deemed to have been completed on the day the instrument was executed, the learned Attorney General relied on Bindeshri vs Somnath Bhadry (1) and Gopal Ram vs Lachmi Misir (2). We do not think that the learned Attorney General 's contention is well founded. We will assume that the learned Attorney General 's construction of the instrument of sale that the property was intended to pass under it on the date of the instrument is correct. Section 47 of the does not, however, say when a sale would be deemed to be complete. It only permits a document when registered, to operate (1) A.I.R. (1916) All. 199. (2) A.I.R. (1926) All. 549. 479 from a certain date which may be earlier than the date when it was registered. The object of this section is to decide which of two or more registered instruments in respect of the same property is to have A effect. The section applies to a document only after it has been registered. It has nothing to do with the completion of the registration and therefore nothing to do with the completion of a sale, when the instrument is one of sale. A sale which is admittedly not completed until the registration of the instrument of sale is completed, cannot be said to have been completed earlier because by virtue of section 47 the instrument by which it is effected, after it has been registered, commences to operate from an earlier date. Therefore we do not think that the sale in this case can be said, in view of section 47, to have been completed on January 31, 1946. The view that we have taken of section 47 of the seems to have been taken in Tilakdhari Singh vs Gour Narain (1). We believe that the same view was expressed in Nareshchandra Datta vs Gireeshchandra Das (2) and Gobardhan Bar vs Guna Dhar Bar (3). With regard to the two cases on which the Attorney General has relied, it has to be observed that they were not concerned with a right of pre emption arising on a sale of property. Bindeshri Prasad 's case (4) was concerned with a suit for zar i chaharum. It does not appear from the report what that right was or when it arose. It is not possible therefore to derive much assistance from it. Gopal Ram 's case( ') was concerned with a right of pre emption arising on the grant of a lease and the question was whether the suit for the enforcement of such a right was barred by limitation. It appears that article 120 was applied to that suit and it was held that the cause of action for the excrcise of the right of pre emption arose as soon as the lease was executed and even before it was registered though before the actual registration the suit for pre emption could not have been maintained. (1) A.I.R (1921) Pat, 150. (2) Cal. 979 (3) I.L.R. (1940) II Cal. 270 (4) A.I.R. (1916) All. 199. (5) A.I.R. (1926) All 549. 480 This view was taken in reliance upon section 47 of the . We are not aware whether the law of pre emption applicable to the case required that there should be a completed lease before the right to pre empt could be enforced. If that law did so require, then we do not think that the case was rightly decided. It was said in that case that "When the law has given to a transaction a retrospective effect, it must have that effect. " We do not think that a transaction which when completed has a retros pective operation can be said for that reason to have been completed on the date from which it has that operation. In the view that we have taken, it is not necessary to discuss the question of the construction of the instrument of sale in this case, that is, to decide whether on its proper reading the transfer was intended to take immediate effect on its execution or later on after the balance of the purchase money had been paid. Nor do we think it necessary to pronounce on the other argument of the learned Attorney General that a transfer which does not convey the property immediately can only be an agreement to transfer. We think that for these reasons this appeal must be dismissed and we order accordingly. The appellants will pay the costs of this appeal. AYYANGAR, J. We regret that we are unable to agree to the order dismissing this appeal. The facts have been very fully set out in the judgment of Sarkar, J. and it is therefore unnecessary to repeat them. The following matters are beyond dispute: (1) that the law that is applicable to govern the right of the appellant before us is the law of pre emption as understood in Mohammedan law, (2) that according to the principles of Mohammedan law, the right of pre emption arises and the 2 talabs have to be performed immediately on the completion of a valid, and bona fide sale, and (3) that the two talabs which are required to be performed by a person claiming the right of pre emption have been performed by the appellant. There being further no dispute that a sale did take 481 place, the only point in controversy in the appeal is as to whether the talabs which were performed on February 2,1946 were performed by the appellant after the right of pre emption accrued to her, viz.,, after the sale in favour of the respondent was effected or were they premature. At one time there was a controversy as to whether it was the principle of the Muslim law that would determine the point of time when a sale should be taken to be complete (under which system crucial significance was attached to two of the ingredients of a sale, viz., payment of consideration and delivery of possession) or whether after the enactment of the it was to the statute and to the creteria laid down by it that one has to turn to determine when a sale should be held to have taken place. The former view found favour with the majority of the Full Bench of the Allahabad High Court in Begam vs Muhammad (1), Justice Banerjee dissenting from the majority. This controversy, however, is long past and it has now been decided by this Court in Radha Kishan vs Shri Dhar Ram Chandra (2) that the provisions of the supersede the principles of the. Mohammedan law as to sale and it was to the statute that one should look to find out whether, and if so when, a sale was complete in order to give rise to a right of pre emption. Turning now to the provisions of the , in the case of a sale of immovable property of the value of Rs. 100 or over (as in the case before us) section 54 of the Act enacts that it could be effected only by a registered instrument; sale itself being defined as "transfer of ownership in exchange for a price paid or promised or part paid and part promised". In other words, the essence of a transaction of sale consists in the transfer of ownership and this transfer has to be effected by "a registered instrument". The while prescribing the formalities of writing and Registration, does not itself determine the point of time when a sale becomes complete. "Registered" under the Transfer (1) I.L.R. 16 All. 344. (2) ; 482 of Property Act means: "registered under the law for the time being in force regulating the registration of documents" (section 3). When one turns to the , provision is made, inter alia for the time within which after its execution a document could be presented for registration, the persons who could so present, the office in which the document could validly be presented and registration effected and sub Part B of starting from section 58 deals with the procedure on admitting documents to registration. Section 60(1) enacts: "After such of the provisions of sections 34, 35, 58 and 59 as apply to any document presented for registration have been complied with, the registering officer shall endorse thereon a certificate containing the word registered ', together with the number and page of the book in which the document has been copied." and section 61 which follows makes provision for the copying of documents in Public registers from which the word "registration" is derived and enacts: "61. The endorsements and certificate referred to and mentioned in sections 59 and 60 shall thereupon be copied into the margin of the Register book, and the copy of the map or plan (if any) mentioned in section 21 shall be filed in Book No. 1. (2)The registration of the document shall thereupon be deemed complete, and the document shall then be returned to the person who presented the same for registration, or to such other person (if any) as he has nominated in writing in that behalf on the receipt mentioned in section 52. " Much reliance has been placed by learned Counsel for the respondent and, indeed, in the judgment of the High Court, on the words the "registration of the document shall thereupon be deemed complete" occurring in sub section (2) of section 61. But in the context of the fasciculus of sections in which it appears it is clear that it refers to the fact that the registering officer had completed his duty and had no more to do with the document presented to him, beyond returning the original to the party entitled to receive the same. In 483 our opinion, these words have nothing to do with the time from which the transaction covered by the registered document operates or with reference to the present context, when the sale evidenced by the deed, becomes complete. Specific provision is made for these in section 47 of the which reads: "A registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration. " The principles underlying sections 61(2) and 47 are not divergent. It is not as if, that any delay by the regis tering officer which might take place owing to the pressure of work in his office or for other reason, has any effect on the rights of parties, quod their property or the time from when the deed operates, or as regards the effectiveness of the transaction, or the priority of transactions inter se. It is not as if, documents executed on different dates, the parties intending them to operate at different times, have their intentions modified, if not nullified by the action or inaction of the registering officer, or any delay that might take place in his office. A contention that though the Muslim law of sale is superseded by the and the , but yet the provision contained in section 47 of the is inapplicable to determine when a sale effected by a registered instrument should be complete could not be sustained on any principle or logic, or of course on any rule of interpretation of statutes. In our opinion no distinction is possible to be drawn between a sale which is effective and one which is complete since they are merely different forms of expressing the same concept and for the same reason between the time from when a sale becomes effective and when it should be held to be complete. As under Muslim law the talabs have to be performed only immediately after the preemptor receives information of the sale, the view we take of the applicability of section 47 of the , introduces no element of hardship in the exercise of the option. We are, therefore, clearly of the opinion that the time when the sale becomes complete so as to 484 entitle the preemptor to perform the talabs should be determined by the application of the principle of intention laid down in section 47 of the Which is as much a part of the positive law governing the right of preemption as the provision of section 54 of the which, requires a registered instrument to effect a sale which gives rise to a right of preemption. If, therefore, B. 47 of the should apply to determine the time from which the registered document should have effect or, in other words, the time from which the sale should be held to be complete, the intention of the parties would be the crucial and only test. That has to be gathered by reference to the document itself read in the light of the surrounding circumstances, with however a proviso that if the document were clear and its terms explicit, no evidence to contradict them would be admissible. Paragraph 4 of this document of the sale deed exhibit 'A ' dated January 31, 1946 recites the consideration for the same. This was to consist of Rs. 2,000. Out of this, it states that the vendors had received Rs. 400 in cash at the time of the execution of the document, and that Rs. 200 had been left with the purchaser for payment to a previous possessory mortgagee. In regard to the balance of Rs. 1,400 the recital reads: "and received the remaining sum of Rs. 1,400 in cash at the time of exchange of equivalents, (that is) at the time of handing over of the receipt of this deed. In this manner we have received the entire amount of consideration money for this vended property from the claimant and brought the same to our possession and use. " It is, no doubt, true that the sum of Rs. 1,400 had not been received on January 31, 1946, the date of the execution of the document and that it was agreed that sum would be paid in exchange for the delivery of the receipt obtained from the Registrar in respect of the sale deed presented for registration. But the use of the past tense clearly indicates that the vendor agreed to the promise to pay the balance of Rs. 1,400 as the consideration for the execution of the 485 document on January 31, 1946, as tantamount to an actual payment. In other words, in terms of section 54 of the it was a transaction under which the property in the house was to be transferred in exchange for a price "part paid and part promised". Paragraph 4 and the recital there do not indicate any intention that the title to the property was to be conveyed only on the payment of Rs. 1,400 on the surrender of the registration receipt. If, however, there was any doubt as to what the intention of the parties was, it is made clear by the other stipulations and recitals which follow. Paragraph 5 opens with the words: "On receipt of the whole and entire amount of consideration money we have put the said claimant into possession and occupation of this vended property as absolute owner in place of us the executants and our heirs and representatives. " The reference to the receipt here is obviously based upon treating the entire consideration of Rs. 2,000 as having been received on the day of the execution of the document. In other words, part of the consideration was paid and part promised and the promise was treated as the consideration in respect of the balance unpaid. Besides and as if to reinforce their intention the deed goes on to state after the words of conveyance "I have executed the deed of absolute sale and jointly received Rs. 2,000 as per recitals in the body. " That the title of the vendee was not to be postponed to any date beyond the date of the execution of the document is made clear by the further words in para 5 "It is desired that the said claimant should enter into and remain in possession and occupation of the vended property as an absolute owner" which was to be from and after the date of the execution of the deed. Turning next to paragraph 6, there is an express stipulation as regards when the transfer should be deemed effective. It says: "This sale deed becomes operative from the date when we, the executants affixed our signatures thereon" a recital which is repeated and reinforced by paragraph 7 in which dealing 62 486 with the title of the vendors, it is stated that the said title with respect to the vended property "has become extinct, inoperative and null and void and the same has now been transferred to and acquired by the claimant". In the face of these recitals, covenants and stipulations which clearly express the intention of the parties that the deed should have effect from the date of its execution it seems to us that the argument that it could be postponed to a later date either the date when the registration was complete under the terms of section 61 of the Indian or to February 7, 1947 when on the registration receipt having been handed over to the vendee, the vendor received the balance of Rs. 1,400 is hardly tenable. If this were the true legal effect of the deed and if by virtue of the provisions of the read in conjunction with those of the Indian , the title to the property was transferred to the vendee immediately on the execution of the document on January 31, 1946 the performance of the two talabs by the appellant on February 2, 1946 would be in time, legal, proper and effective to clothe her with a right to demand a conveyance in her favour. It is only necessary to add that learned Counsel for the respondent did not contest the position that if on a proper construction of the sale deed exhibit 'A ' read in the light of its recitals and the relative statutory provisions there was a sale effective on January '31, 1946 the talabs performed by the appellant would not suffice to clothe her with the right which she claimed in the suit out of which this appeal arises. We would accordingly allow the appeal and decree her suit with costs throughout. By COURT. In accordance with the opinion of the majority, the appeal is dismissed with costs.

P executed a sale deed on January 31, 1946, in respect of a house in favour of D and presented it for registration on the same day. On coming to know of the execution of the sale deed, the appellant who had a right of preemption, made the talab i mowasibat on February 2, 1946. The deed was copied out in the Registrar 's books on February 9, 1946, and thereupon the registration became complete as provided in section 61 of the . The appellant filed a suit for preemption. D resisted the suit on the ground that the sale was completed on February 9, 1946, and the talab had been made prematurely. The appellant contended that in view Of section 47 a registered document operated from the time it would have otherwise operated and the sale was completed on the date of its execution. Held (per Sinha, C. J., Sarkar and Mudholkar, jj.) that the sale was completed only on February 9, 1946, when the registration was complete, that the talab was made prematurely and that the suit must fail. Section 47 merely permitted a document when registered to operate from a date which may be earlier than the date on which it was registered, it did not say when the sale would be deemed to be complete. A sale which was required to be registered was not completed until the registration of the deed was completed. Tilakdhari Singh vs Gour Narain, A.I.R. (1921) Pat. 150, Nareshchandra Datta vs Gireeshchandra Das, Cal. 979, and Gobardhan Bar vs Guna Dhar Bar, I.L.R. (1940) II Cal. 270, approved. Bindeshri vs Somnath Bhadry, A.I.R. (1916) All. 199 and Gopal Ram vs Lachmi Himir, A.I.R. (1926) All. 549, distin guished. Per Das Gupta and Ayyangar, jj. The sale was completed on the day of execution and the talab was made at the right time. Section 61 had nothing to do with the time when the sale evidenced by the registered deed became complete; it refers merely to the fact that the registering officer had completed his duty. Section 47 provided when a sale was deemed to be completed. There was no difference between the time when a sale 475 became effective and the time it could be held to be completed. Under section 47 the crucial test for determining the time from which the registered document was to have effect or be deemed to be completed was the intention of the parties. The sale deed shows that the parties intended that the deed should be effective from the date of execution.

Nos. 232,233, 286, 309, 320, 351, 319, 350, 354 and 490 of 1951. Applications under article 32 of the Constitution for writs to enforce the fundamental rights of the petitioners. C. K. Daphtar (R. M. Hajarnavis, with him) for the petitioner in Petition No. 232. M. C. Setalvad (G. N. Joshi and B. M. Hajarnavis, with him) for the petitioner: in Petition No. 233. B. M. Hajarnavis for the petitioners in Petitions Nos. 286, 309 and 320. V. N. Swami for the petitioners in Petitions Nos., 350 and 351. N. section Bindra (B. section Narula with him) for the petitioners in Petitions Nos. '319, 354 and 490. T. L. Shivde, Advocate General of Madhya Pradesh, for the respondent in all the petitions, the State of Madhya Pradesh. December 22. The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J. These are petitions under article 32 of the Constitution of India for directions or orders or writs to enforce the fundaments rights, of the petitioners to property by prohibiting, the respondent, the State of Madhya Pradesh, from enforcing their alleged rights under the Madhya Pradesh Abolition of Proprietary Rights Act, 1950. The several petitioners entered into contracts and agreements with the previous proprietors of certain estates and mahals in the State under which it is said they acquired the rights to pluck, collect and carry away tendu leaves, to cultivate, culture and acquire lac and to cut and carry away teak and timber and miscellaneous special of trees called hardwood and 478 bamboos. The contracts and agreements are in 'writing some of them are registered. There is no dispute about their genuineness, and it has not been alleged that they are 'collusive or fraudulent transactions. Their dates and the several sums of money paid as consideration are set out in the petitions. The petitioners allege that they have spent large sums of money in the exercise of their rights, and his fact too is not controverted. Petitions Nos. 232, 233, 286, 309 and 320 of 1951 relate to tendu leaves which grow in shrub jungles and which are used in the manufacture of beedis or country made cigarettes, a very extensive and competitive business carried on by some of the petitioners involving an outlay of one to two lakhs of rupees in some cases. For instance, 406 contracts are involved in Petition No. 232 of 1951 ; the consideration paid comes to Rs. 1,65,385 and the expenses are alleged to be in the region of Rs. 1,90,000. In Petition No. 233 of 1951 there are 785 contracts; the purchase money is Rs. 1,10,605 and the outlay byway of 'expenses is said to be Rs. 50,000. Petition No. 319 of 1951 relates to the culture and cultivation of lac, and there are several lease deeds of different dates enuring for different periods; two of them go up to the years 1966 and 1967. Teak,, timber and hardwood form the subject matter of the rights involved in Petition No. 350 of 1951 and the registered lease deed is dated 8th October, 1949, and it is for a term of ten years. Petition No. 351 of 1952 involves tendu leaves and miscellaneous forest produce and timber. Petition No. 354 of 1951 relates to bamboo forests, and Petition No. 490 of 1951 to hardwood and bamboo. The contentions of the petitioners are mainly three in number. They say that the rights acquired by them under these contracts and agreements were got before the passing of the Madhya Pradesh Abolition 479 of Proprietary Rights Act, 1950, and that the legislation therefore does not affect them. It is urged next that they are not proprietors within the meaning of the Act and consequently the Act does not apply to them. Lastly, the question is raised that the Act itself is ultra vires, as many of its material provisions offend their fundamental rights guaranteed under the Constitution. The full title of the Act is the " Madhya Pradesh, Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950 ", and it is Madhya Pradesh Act I of 1951. It came into force on 26th January, 1951. On the very next day, there was a notification under section 3 of the Act putting an end to all proprietary rights in estates, mahals and alienated villages and vesting the same in the State for the purposes of the State free of all encumbrances with effect from 31st March, 1952. The validity of the Act was questioned by the affected proprietors in Visheshwar Rao vs The State of Madhya Pradesh (1) before this Court, and the Act was held to be valid. The petitioners are concluded. We have to consider only the other two points raised on behalf of the petitioners. It is clear from the provisions in the impugned Act that only those rights of the proprietor vest in the State which the proprietor had on the specified date. Section 3 provides that on and from a date to be specified by a notification by the State Government, all proprietary rights in an estate or mahal vesting in a proprietor shall pass from him to and vest in the State. The consequences of vesting are given in section 4 of the Act, and it is provided that the vesting will take place, notwithstanding anything. contained in any contract, grant or document or in any other law for the time being in force and save as otherwise provided in this Act. But this again deals only with the rights existing on the date of the notification the section is not retrospective. (1) 480 Clause (a) speaks of all rights,title and interest vesting in the proprietor or any person having interest in such propreitory right through the proprietor. Clause (b) is to this effect "all grants and confirmation Of title of or to land in the property so vesting Or Of or, to any right or privilege in respect of such property orland revenue in respect thereof shall, whether liable to resumption or not, determine;" The right or privilege referred to is the right or privilege of the proprietor or any person having interest in the proprietary right through the proprietor. Clause (c) is quite clear on the subject; it runs thus: "all rents and cossesi in respect of any holding in the property so vesting for any period after the date of vesting and which. but for the vesting, would be payable to the proprietor shall vest in and be payable to the State Government. ." The words " after the date of vesting " are important. Sub section (3) of section 4 says Nothing contained in subsection (1) shall operate as a bar to the recovery by the outgoing proprietor of any sum which becomes due to him before the date of vesting by virtue of his proprietary rights and any such sum shall be recoverable by him by any process of law which but for this Act would be available to him. " If the outgoing proprietor is entitled to, recover any sums as quid pro quo for what he has parted with under the transfer, it can only be on the basis that the transfer is a good and valid transaction unaffected by the Act. Section 6 is very material, and it is in these terms ' (1) Except as provided in sub section (2), the transfer of any right in the property 'Which is liable 481 to vest in the state under this Act made by the proprietor at any time after the 16th March, 1950, shall,. as from the date of vesting, be void. (2) Where on the. application of the transferor or the transferee, the Deputy Commissioner is satisfied that any transfer of property referred to in subsection (1) was made by a proprietor in good faith and in the ordinary course of village management, he may declare that the transfer shall, not be void* after the date of vesting. " The date, 16th March, 1950, is probably the date when legislation on these lines was actively thought of, and sub section (1) hits at transfers made after this date. This means that transfers before that date are not to be regarded as void. Even in the case of transfers after the said date, sub section (2). provides that the Deputy Commissioner may declare that they .are not void after the date of vesting, provided they were made in good faith and in the ordinary course of management. , The scheme of the Act as can be gathered from the provisions referred to above makes it reasonably clear that whatever was done before 16th March, 1950, by the proprietors by way of transfer of rights is not to, be disturbed or affected, and that what vests in the State is what the proprietors had oil the vesting date. If the proprietor had any rights after the date of vesting which he could enforce against the transferee such as a lessee or a licensee, those rights would no doubt vest in the State. In all these petitions, the several contracts and, agreements were before the date of vesting, and many of them were prior even to the 16th March, 1950. The petitioners had taken possession of the subject matter of the contracts, namely, tendu leaves, lac palsadies, teak, timber and hardwood, bamboos and miscellaneous forest produce. Under the Indian Sale of Goods Act, "goods" include growing crops, grass and things attached to or forming part of the land, which are agreed to be severed before sale or under the contract of sale 482 notwithstanding the definition of "immovable property " in section 3 (25) of the General Clauses Act of 1897. In Petition No. 232 of 1951 two sample agreements relating to tendu leaves are given as annexures A and B to the petitions. They may be quoted in extenso for a clear understanding of the nature of the right created. Exhibit A dated 16th November, 1950, is in these terms: " Receipt written in favour of Seth Chhotabhai Jethbai Patel Company shop Gondia, and written by Shri Madhavrao Gangadhar Rao Chitnavis shop Itan receipt is written that we are owners of forests of Tendu leaves of Monza Sawarla 0 12 0 Mauza Khatkheda 0 5 0 Mouza Nati Kheda 0 16 0 and Monza Welwa 0 16 0. We have given contract (Theka) of cutting Tendu leaves from these four villages for one year that is till the end of June for Rs. 2,500 out of this we had received Rs. 300 on 21st September, 1950, at Bhandara and the balance Rs. 2,200 was received from your Bhandara shop through Balubhai. Nothing remains to be paid to us. You have a right to coppice the trees. " The terms of Exhibit B dated 12th July, 1948, Emitting unnecessary portions are as follows: In the year 1948 A.D. theka patra is executed that in consideration of the amount received as detailed above I had given the full tendu leaves jungle for taking out tendu leaves for five years from 1949 A.D. to 1053 A.D. I have immediately given possession. Now you can take tendu leaves of the tendu leaves forests described above every year for five years till the end of June, 1953. You may coppice the plants and take leaves. At the end of June, 1953, you should return my jungle without damage or loss to me. After the end of the period it depends upon my will whether or not I give you the forests on theka (again). If any one obstructs you in coppicing or taking away leaves, I will be responsible for the damages. Hence I have executed 483 this theka pathi for five years for consideration after reading and understanding. I agree with it. Dated 12th July, 1948, by pen of Waman Sadeshic Amte Petition Writer Bhandara. " The contracts and agreements appear to be in essence and effect licenses granted to the transferees to cut, gather and carry away the produce in the shape of tendu leaves, or lac, or timber, or wood. A similar agreement came up for consideration by the Judicial Committee of the Privy Council in Mohanlal Hargovind of Jubbulpore vs Commissioner of Income tax, Central Provinces and Berar, Nagpur (1) in connection with a question arising out of the Income tax Act. Some of the observations contained in the judgment dealing with the nature of such an agreement are useful and may be quoted here : " The contracts grant no interest in land and no interest in the trees or plants themselves. They are simply and solely contracts giving to the grantees the right to pick and carry away leaves, which, of course, implies the right to appropriate them as their own property. The small right of cultivation given in the first of the two contracts is merely ancillary and is of no more significance than would be e.g., a right to spray a fruit tree en to the person who has bought the crop of apples. The contracts are short term contracts. The picking of the leaves under them has to start at once or practically at once and to proceed continuously. " There is nothing in the Act to affect the validity of the several contracts and agreements. The petitioner are neither proprietors within the meaning of the Act nor persons having any interest in the proprietary right through the proprietors. There is no provision in the Act which extinguishes their rights in favour of the State. 'What exactly is meant by a ,proprietary right " under the revenue laws has been (1).I.L.R. , 63 484 pointed out at page 217 of Volume I of Baden Powell 's Land Systems of British India, where he says: The first thing that will strike the student is the .use of the term ' proprietary right ' in these pages and in Indian Revenue Books generally. It does not occur in text books on English law or jurisprudence. I presume that the use of such a phrase is due to the ad feeling that we rarely acknowledge anything like a complete unfettered right vested in any one person. The interest in the soil has come to be virtually shared between two or even more grades, the cause of which we just now discussed. It is true that, in many cases, only one person is called ' landlord ' or ' actual proprietor ' but his right is limited; the rest of the right, so to speak, is in the hands of the other grades, even though they are called 'tenants ' or by some vague title such as ' tenure holders. ' In many cases, as we have seen, this division of right is accentuated by the use of terms like sub proprietor ' or proprietor. of his holding '. The 'proprietary right seems then a natural expression for the interest held by a landlord, when that interest is not the entire 'bundle of rights ' (which in the aggregate make up an absolute or complete estate) but only some of them, the re mainder being enjoyed by other persons. " The definitions given in the Act do not abrogate or vary this meaning. The respondent State cannot invoke in its aid section 3, sub clause (1) of the Act which speaks of the vestina of proprietary rights free of all encumbrances, because the rights of the petitioners either as buyers or lessees or licensees are not encumbrances as ordinarily understood. The last part of clause (a) of section 4 (1) indicates that mortgage debts and charges on the proprietary right are meant by encumbrances. In this view, it becomes unnecessary to consider the question as to when title in the property passes to the transferee. Section 4, sub section (3) of the Indian Sale of Goods Act which lays down that in the case of sale of future goods the contract amounts 485 only to an agreement to sell does not seem to be applicable to the contracts and agreements here, as the goods are not " future goods " as defined in subclause (6) of the Act which states that they mean goods to be manufactured or produced or acquired by the seller after the making of the contract of sale. Benjamin says in his treatise on Sale (8th Edition) at page 136: " Things not yet existing which may be sold (that is to say, a right to which may be immediately granted) are those which are said to have a potential existence, that is, things which are the natural produce, or expected increase of some thing already owned or possessed by the seller. A man may sell the crop of hay to be grown in his field, the wool to be clipped from his sheep at a future time, the milk that his cows will yield in the coming month, and similar things. Of such things there could be, according to the authorities, an immediate grant or assignment, whereas there could only be an agreement to sell where the subject of the contract is something to be afterwards acquired; as the wool of any sheep, or the milk of any cows, which the seller might buy within the year, or any goods to which he might obtain title within the next six months. " The goods covered by the present petitions are goods which have a potential existence, and according to the decisions discussed by the learned author, there can be a sale of a present right to the goods as soon as they come into existence. Whether title passes on the date of the contract itself or later is really dependent on the intention of the parties, and as already stated, in these petitions the stipulated consideration has passed from the transferees to the proprietors, and possession also has been taken. We hold that the respondent has no right to interfere with the rights of the several petitioners under the contracts and agreements in their favour set out in their petitions, and we hereby issue a writ prohibiting the State from interfering in any manner whatsoever with the enjoyment of those rights by the 486 petitioners. In cases where the periods under the contracts have expired, or where the proprietors have ill to recover anything from the transferees after he date of vesting, the State will be at perfect liberty to assert and enforce its rights standing in the shoes of the proprietors. The respondent will pay the petitioners their respective costs. Petition allowed. Agent for the petitioners in Petitions Nos. 232, 233, 286, 309 and 320 : Bajinder Narain. Agent for the petitioners in Petitions Nos. 360 and 351: M. section H. Sastri. Agent for the petitioners in Petitions Nos. 319, 354 and 490: Harbans Singh. Agent for the respondents in all petitions: G. H. Rajadhyaksha.

The Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act of 1950 put an end to all proprietary rights in estates, mahals and alienated villages situated in the State and vested them in the State for the purposes of the State, free from all encumbrances. The petitioners, who had entered into various contracts and agreements with the proprietors of the estates before the date on which the estates vested in the State under the Act (and,some of them even before the 16th March, 1950) under which they were entitled to pluck, collect and carry away tendu leaves, to cultivate, culture and acquire lac, and to out and carry away teak and timber and other species of trees, applied for writs under art 32 of the Constitution prohibiting the State from interfering with the rights they had, acquired under the contracts with the proprietors: Held, (i) On construction of the contracts in a question, that the contracts were in essence and effect licenses granted to the petitioners to cut, gather and carry away produce in the shape of tendu leaves, lac, timber, or wood and the petitioners were neither proprietors nor persons having any interest in the proprietary rights through the proprietors, within the meaning of the Act; (ii) The rights of the petitioners were not encumbrances within the meaning of the expression "free from encumbrances in section 3 . 1) of the Act and the petitioners were entitled to a writ against the State prohibiting the State from interfering with the rights of the petitioners under the contracts which they had entered into with the proprietors. Mohanlal Hargovind vs Commissioner of Income tax, C.P,& Berar (I.L.R. [19491 Nag. 892) referred to. Held also, that section 4 (3) of the Indian Sale of Goods Act which lays flown that in the case of sale of future goods the contract 477 amounts only to an agreement to sell did not apply to the contracts in the present case as "future goods" are defined in the Act as meaning goods to be manufactured or produced or acquired by the seller after making the contract of sale.

Appeals Nos. 635 to 641 of 1957. Appeals from the judgment and decree dated September 8, 1954, of the Punjab High Court in Regular First Appeals Nos. 42, 43, 44, 45, 46, 47 and 48 of 1949. R. Gopalakrishnan, T. M. Sen and R. H. Dhebar, for the appellants. Darya Dutt Chawla, for the respondents. May 1. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. Civil Appeal No. 635 of 1957 is an appeal, by certificate, and raises the question regarding the effect of the abatement of the appeal, by the State of Punjab, against Labhu Ram, one of the respondents, on the State appeal against Nathu Ram, co respondent. Civil Appeals Nos. 636 to 641 of 1957 also raise the same question between the same parties. The facts leading to the appeal are that the Punjab Government acquired on lease certain parcels of land belonging to Labhu Rain and Nathu Ram, for different military purposes, under the Defence of India Act, 81 638 1939 (XXXV of 1939). Labhu Ram and Nathu Ram, brothers, refused to accept the compensation offered to them by the Collector and applied to the Punjab Government, through the Collector, under r. 6 of the Punjab Land Acquisition (Defence of India) Rules, 1943, hereinafter called the Rules, as amended by the Notification of the Punjab Government No. 1444 HM44/19124, dated 10th March, 1944, and published in the Punjab Gazette, Part 1, dated 17th March, 1944 (Home Department). The State Government referred the matter to an arbitrator as required under r. 10, who, after enquiry, passed an award ordering the payment of an amount higher than what was offered by the Collector and also ordered the payment of certain amount on account of income tax which would be paid on the compensation received. The State Government appealed against the award to the High Court of Punjab. During the pendency of the appeal, Labhu Ram, one of the respondents, died. The High Court, holding that the appeal abated against Labhu Ram and that its effect was that the appeal against Nathu Ram also abated, dismissed the appeal. It also dismissed the cross objections. The State Government applied for a certificate of fitness of the case for appeal to this Court and the High Court granted it, as questions of great private and public importance were involved. It is not disputed that in view of 0. XXII, r. 4, Civil Procedure Code, hereinafter called the Code, the appeal abated against Labhu Ram, deceased, when no application for bringing on record his legal representatives had been made within the time limited by law. The Code does not provide for the abatement of the appeal against the other respondents. Courts have held that in certain circumstances, the appeals against the co respondents would also abate as a result of the abatement of the appeal against the deceased respondent. They have not been always agreed with respect to the result of the particular cir cumstances of a case and there has been, consequently, divergence of opinion in the application of the principle. It will serve no useful purpose to consider the cases. Suffice it to say that when 0. XXII, r. 4 does 639 not provide for the abatement of the appeals against the co respondents of the deceased respondent, there can be no question of abatement of the appeals against them. To say that the appeals against them abated in certain circumstances, is not a correct statement. Of course, the appeals against them cannot proceed in certain circumstances and have therefore to be dismissed. Such a result depends on the nature of the relief sought in the appeal. The same conclusion is to be drawn from the provisions of 0. 1, r. 9, of the Code which provides that no suit shall be defeated by reason of the misjoinder or non joiner of parties and the Court may, in every suit, deal with the matter in controversy so far as regards the rights and interests of the parties actually before it. It follows, therefore, that if the Court can deal with the matter in controversy so far as regards the rights and interests of the appellant and the respondents other than the deceased respondent, it has to proceed with the appeal and decide it. It is only when it is not possible for the Court to deal with such matters, that it will have to refuse to proceed further with the appeal and therefore dismiss it. The question whether a Court can deal with such matters or not, will depend on the facts of each case and therefore no exhaustive statement can be made about the circumstances when this is possible or is not possible. It may, however, be stated that ordinarily the considerations which weigh with the Court in deciding upon this question are whether the appeal between the appellants and the respondents other than the deceased can be said to be properly constituted or can be said to have all the necessary parties for the decision of the controversy before the Court. The test to determine this has been described in diverse forms. Courts will not proceed with an appeal (s) when the success of the appeal may lead to the Court 's coming to a decision which be in conflict with the decision between the appellant and the deceased respondent and therefore which would lead to the Court 's passing a decree which will be contradictory to the decree which had become final with respect to 640 the same subject matter between the appellant and the deceased respondent; (b) when the appellant could not have brought the action for the necessary relief against those respondents alone who are still before the Court and (c) when the decree against the surviving respondents, if the appeal succeeds, be ineffective, that is to say, it could not be successfully executed. There has been no divergence between the Courts about the Court 's proceeding with the appeal between the respondents other than the deceased respondent, when the decree in appeal was not a joint decree in favour of all the respondents. The abatement of the appeal against the deceased respondent, in such a case, would make the decree in his favour alone final, and this can, in no circumstances, have a repercussion, on the decision of the controversy between the appellant and the other decree holders or on the execution of the ultimate decree between them. The difficulty arises always when there is a joint decree. Here again, the consensus of opinion is that if the decree is joint and indivisible, the appeal against the other respondents also will not be proceeded with and will have to be dismissed as a result of the abatement of the appeal against the deceased respondent. Different views exist in the case of joint decrees in favour of respondents whose rights in the subject matter of the decree are specified. One view is that in such cases, the abatement of the appeal against the deceased respondent will have the result of making the decree affecting his specific interest to be final and that the decree against the other respondents can be suitably dealt with by the appellate Court. We do not consider this view correct. The specification of shares or of interest of the deceased respondent does not affect the nature of the decree and the capacity of the joint decree holder to execute the entire decree or to resist the attempt of the other party to interfere with the joint right decreed in his favour. The abatement of an appeal means not only that the decree between the appellant, and the deceased respondent has become final, but also, as a necessary corollary, 641 that the appellate Court cannot, in any way, modify that decree directly or indirectly. The reason is plain. It is that in the absence of the legal representatives of the deceased respondents, the appellate Court cannot determine anything between the appellant and the legal representatives which may affect the rights of the legal representatives under the decree. It is immaterial that the modification which the Court will do is one to which exception can or cannot be taken. It is therefore necessary to determine, on the facts of this case, whether the State appeal could proceed against Nathu Ram. The award of the arbitrator in each of these cases was a joint one, in favour of both the respondents Labhu Ram and Nathu Ram. To illustrate the form of the award, we may quote the award for the year 1945 46 in the proceedings leading to Civil Appeal No. 635 of 1957. It is: "On the basis of the report of section Lal Singh, Naib Tehsildar (Exhibit P. W. 9/1) and Sheikh Aziz Din, Tehsildar, Exhibit P. W. 9/2, the applicants are entitled to a sum of Rs. 4,140 on account of rent, plus Rs. 3,872 8 0 on account of Income tax etc., due to the inclusion of Rs. 6,193 8 0 in their total income, plus such sum as the petitioners have to pay to the Income tax Department on account of the inclusion of Rs. 4,140 in their income as awarded by this award." The result of the abatement of the appeal against Labhu Ram is therefore that his legal representatives are entitled to get compensation on the basis of this award, even if they are to be paid separately on calculating their rightful share in the land acquired, for which this compensation is decreed. Such calculation is foreign to the appeal between the State of Punjab and Nathu Ram, The decree in the appeal will have to determine not what Nathu Ram 's share in this compensation is, but what is the correct amount of compensation with respect to the land acquired for which this compensation has been awarded by the arbitrator. The subject matter for which the compensation is to be calculated is one and 642 the same. There cannot be different assessments of the amounts of compensation for the same parcel of land. The appeal before the High Court was an appeal against a decree jointly in favour of Labhu Ram and Nathu Ram. The appeal against Nathu Ram alone cannot be held to be properly constituted when the appeal against Labhu Ram bad abated. To get rid of the joint decree, it was essential for the appellant, the State of Punjab, to implead both the joint decree holders in the appeal. In the absence of one joint decree holder, the appeal is not properly framed. It follows the that State appeal against Nathu Ram alone cannot proceed. It is however contended for the State that according to the entries in the village records, Labhu Ram and Nathu Ram had equal shares in the land acquired and that therefore the appeal against Nathu Ram alone can deal with half the amount of the award. We do not agree. The mere record of specific shares in the revenue records is no guarantee of their correctness. The appellate Court will have to determine the share of Nathu Ram and necessarily the share of Labhu Ram in the absence of his legal representatives. This is not permissible in law. Further, the entire case of Labhu Ram and Nathu Ram, in their application to the Government for the appointment of an arbitrator, was that the land jointly belonged to them and had been acquired for military purposes, that a certain amount had been paid to them as compensation, that they received that amount under protest and that they were entitled to a larger amount mentioned in the application and also for the income tax they would have to pay on account of the compensation received being added to their income. Their claim was a joint claim based on the allegation that the land belonged to them jointly. The award and the joint decree are on this basis and the appellate Court cannot decide on the basis of the separate shares. The State objected before the arbitrator, and urges before us, that under the rules, the joint application of Labhu Ram and Nathu Ram should have been 643 treated as separate applications with respect to the correctness of the compensation payable to each of them respectively and that the arbitrator should have made separate awards with respect to such separate claims of Labhu Ram and Nathu Ram. The necessary corollary of such a contention for the State is that the abatement of the appeal against Labhu Ram will not make infructuous the appeal against Nathu Ram. The respondent urges that the Punjab Land Acquisition (Defence of India) Rules, do not contemplate separate applications by the persons interested in the compensation on account of the acquisition of a particular parcel of land. The arbitrator did not agree to deal with the claims of Labhu Ram and Nathu Ram separately. He, however, did not decide the question on the basis of the land belonging jointly to the two brothers as members of the joint Hindu family. He however held that the expression 'a person interested ' in r. 3, included all persons claiming an interest in the compensation to be paid on account of the acquisition of the land and that r. 18 permitted the joinder of applications for joint enquiry when each case rested on the same and similar basis and each of the applications included land included in a larger part of land acquired at one time. He also took into consideration that the separation of the applications of Labhu Ram and Nathu Ram would involve various difficulties in matters of income tax. He therefore used his discretion and ordered the application to be proceeded with jointly. In view of our opinion on the main point, we do not consider it necessary to interpret the rules and decide whether the joint application was maintainable or not. The fact remains that Labhu Ram and Nathu Ram made a joint claim and got a joint decree against the State for compensation. The frame of the appeal is to be with reference to the nature of the decree challenged. We therefore see no force in this appeal and dismiss it with costs. This order will govern the other 644 connected appeals, viz., Civil Appeals Nos. 636 to 641 of 1957. Appeal dismissed.

The Punjab Government acquired certain parcels of land belonging to two brothers Land N who refused to accept the compensation offered to them and applied to the Government of Punjab under r. 6 of the Punjab Land Acquisition (Defence of India) Rules, 1943, to refer to arbitration their joint claim based on the allegation that the land belonged to them jointly. The State Government referred the matter to an arbitrator as required under r. 10 who passed an award in favour of both L and N ordering inter alia payment of an amount higher than what was offered to them by the Government. The Government appealed against the said award to the High Court. During the pendency of the appeal before the High Court respondent L died and as no application for bringing on record his legal representative had been made within the time limit, the High Court dismissed the appeal holding that the appeal had abated against L and that its effect was that the appeal against N also abated. Held, that there can be no question of abatement of appeal against the correspondents of the deceased respondent as Order 22 Rule 4 of the Code of Civil Procedure does not provide for the same but in certain circumstances the appeal cannot proceed against them and such a result depends on the nature of the relief sought in the appeal. If the Court can deal with the matter in controversy so far as regards the rights and interest of the appellant and the respondents other than the deceased respondent, it has to proceed with the appeal and decide it; otherwise it will have to refuse to proceed further with the appeal and therefore dismiss it. Ordinarily, the consideration which will weigh with the court in deciding upon the question whether the entire appeal had abated or not will be whether the appeal between the appellants and the respondents other than the deceased respondent can be said to be properly constituted or can be said to have all the necessary parties for the decision of the controversy before the court and the tests to determine this have been described thus: (a) when the success of the appeal may lead to the court 's coming to a decision which will be in conflict with the decision between the appellant and the deceased respondent and therefore which would lead to the court 's passing a decree which will be contradictory to the decree which had become 637 final with respect to the same subject matter between the appellant and the deceased respondent; (b) when the appellant could not have brought the action for the necessary relief against those respondents alone who are still before the court and (c) when the decree against the surviving respondents, if the appeal succeeds, be ineffective that is to say it could not be successfully executed. The abatement of an appeal against the deceased respondent means not only that the decree between the appellant and the deceased respondent has become final but also as a necessary corollary that the appellate court cannot in any way modify that decree directly or indirectly. When the decree in favour of the respondents is joint and indivisible, the appeal against the respondents other than the deceased respondent cannot be proceeded with if the appeal against the deceased respondent has abated. In the present case the appeal against N alone was not pro perly constituted when the appeal against L had abated and the State appeal against N alone could not proceed.

Appeal No. 371 of 1957. Appeal from the judgment and decree dated August 22, 1955, of the Bombay High Court in Appeal No. 49 of 1955. C. B. Agarwala, J. B. Dadachanji, Ravinder Narain and O. C. Mathur, for the appellant. Ajit H. Mehta and I. N. Shroff, for the respondent,. 1961. May 1. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This appeal arises from a suit filed by M/s. Binani Commercial Co. Ltd., on the Original Side of the Bombay High Court against the respondent Ramanlal Maganlal Mehta. In its suit the appellant sought to recover from the respondent a sum of Rs. 93,053 3 0 which represented the loss suffered by it in the transaction in question or in the alternative damages for Rs. 88,229 3 0 for breach of the contract in respect of the said transaction. The appellant is a Limited Company and it carries on business in Bombay as metal merchants, bankers and commission agents. The respondent also carries on business in Bombay under the name and style of M/s. Balasinor Export and Import Co., and also as M/s. Ramanlal and Sons. In January 1952 the appellant agreed to sell to the respondent 300 tons of Electrolytic Zinc at the rate of Rs. 171 per cwt. against delivery orders issued under the regulations of the Metal Traders Association, Ltd., for Posh Sudi 15 delivery (January 12, 1952). The respondent promised to pay for the said goods by January 21, 1952 and to take delivery thereafter. The respondent paid to. the appellant several sums aggregating Rs. 1,56,000 as a deposit for the price of the said goods. The appellant tendered the said goods to the respondent whereupon he arranged to take delivery of only 160 tons and made payments on account. The appellant then tendered the balance of 140 tons to the respondent but the respondent failed and neglected to take delivery of the said balance and to pay for it. As a 628 result of the respondent 's default in taking delivery the appellant had to sell the balance in the falling market at Rs. 81 per cwt., and that had resulted in the loss to the appellant. That in brief is the nature of the claim made by the appellant against the respondent. This claim was resisted by the respondent on several grounds. The principal ground urged by him, however, was that the transaction in suit for the sale of 300 tons of Electrolytic Zinc was in contravention of the provisions of Supply and Prices of Goods Act, 1950 (70 of 1950) and cl. (b) of the Government of India Notification No. 1(4) 32(17)50 issued on September 2, 1950. According to the respondent the said transaction was void and illegal and therefore the appellant 's claim was not maintainable in law. The respondent also raised other contentions on the merits without prejudice to his principal contention about the illegality of the contract. The suit was tried by Coyajee, J. on the Original Side of the Bombay High Court. The principal defence raised by the respondent was tried as a preliminary issue by the learned Judge. On this preliminary issue, the learned Judge held that the defence set out by the respondent was not good and not applicable to the facts and circumstances of the case. His conclusion, therefore, was that the contract was valid. The learned Judge, after delivering this interlocutory judgment, proceeded to try the issues on the merits, and having found in favour of the appellant on the said issues he directed that the matter be referred to the Commissioner for taking accounts to ascertain the damages suffered by the appellant in the light of the directions given in the Judgment. Against this decision the respondent preferred an appeal and the Division Bench of the Appeal Court allowed his appeal. Before the Court of Appeal only one point was argued and that was in regard to the validity of the contract. The Court of Appeal has held, reversing the conclusion of the trial Judge, that the defence raised by the respondent was good and that the contract in question was invalid. In the 629 result the Appeal Court has directed that the appellant 's suit should be dismissed with costs. The appellant then applied for and obtained a certificate from the said High Court and it is with that certificate that it has come to this Court by its present appeal; and the main contention raised by Mr. Agarwala on behalf of the appellant is that the view taken by the Division Bench in upholding the contention of the respondent against the validity of the contract is erroneous in law. It is, therefore, necessary at the outset to refer to the material provisions of the Supply and Prices of Goods Act 70 of 1950 (hereafter called the Act) and to examine very broadly its scheme and purpose. The Act has been passed in pursuance of a resolution under article 249 of the Constitution for the control of prices of certain goods and the supply and distribution thereof. Article 249 confers on Parliament the power to legislate in regard to a matter in a State List but the said power can be exercised only in national interest and after the Council of State passes a resolution in that behalf supported by at least two third of the members voting. There is no doubt that the Act has been passed in national interest because national interest undoubtedly required that the supply and prices of certain types of goods should be controlled by the Central Legislature. The prices in regard to those goods which are essential for national economy are apt to vary from place to place, and unless the supply of goods is rationally controlled the goods may be available in plenty in one place and may not be available in adequate measure in another. It is with a view to make the ' supply of controlled goods fairly available in the country at a reasonable price that the Act purports to impose the necessary restrictions to regulate the supply and sale of the said goods. Section 2 of the Act defines goods as meaning goods to which the Act applies. Section 3 provides, inter alia, that the Act applies to the goods specified in the Schedule and to such other goods that the Central Government may by a notified order specify in 80 630 that behalf. Section 4 deals with the fixing of maximum prices and maximum quantities which may be held or sold, while section 5 imposes restrictions on possession and sale by dealers and producers where maximum is fixed under section 4. Under section 6 is imposed a general limitation of quantity which may be possessed at any one time, and the proviso to sub section (1) makes it clear that it does not apply to the persons specified in cls. (a) and (b) of the proviso. A duty to declare possession of excess stocks is imposed by section 7, while section 8 imposes an obligation to sell goods as therein specified. Failure to comply with the requirements of the said section is made an offence under the Act. Under section 13 power is conferred on the Central Government to regulate production and distribution of goods, and section 16 confers power on the Central Government to authorise by general or special order any officer not below the rank of an inspector of police to effect search and seizure for the purpose of enforcing the provisions of this Act. It is thus clear that the sections of the Act have been so framed as to give effect to the object of the Act to regulate and control the supply and prices of goods which are brought within the purview of the Act in the interest of national economy. In the present appeal we are directly concerned with the notification issued under section 4(1)(c). It is, however, necessary to read section 4. Section 4 provides thus: "4. (1) The Central Government may, by noti fied order, fix in respect of any goods (a) the maximum price or rate which may be charged by a dealer or producer; (b) the maximum quantity which may at any one time be possessed by a dealer or producer; (c) the maximum quantity which may in one transaction be sold to any person. (2) Any such order may (a) fix maximum prices or rates and maximum quantities for the same description of goods differently in different localities or for different classes of dealers or producers; 631 (b) instead of specifying the maximum price or rate to be charged, direct that price or rate shall be computed in such manner and by reference to such matters as may be provided by the order. " Section 5 imposes restriction on possession and sale by dealers and producers in cases covered by section 4 and provides by sub section (1)(c) that no dealer or producer ,,hall sell or agree to sell or offer for sale to any person in any one transaction a quantity of any goods exceeding the maximum fixed under cl. (c) of sub section (1) of section 4. It would be recalled that the respondent 's contention is that the contract in suit is void because it contravenes the provisions of section 5(1)(c) in that it does not comply with the requirements of the notification issued under section 4(1)(c). Thus, for deciding the narrow controversy between the parties it would be necessary to determine the scope and effect of the provisions of section 4(1)(c) and the notification issued under it and the provisions of section 5(1)(c). Let us now read the notification. The notification provides: "(b) No such dealer or producer shall sell any non ferrous metals exceeding one ton unless he has obtained a declaration in writing from the buyer that the quantity proposed to be sold to him does not exceed his requirements for consumption for three months or in case the buyer is a dealer his require ments for normal trade for three months. " What does the notification provide? It provides that no dealer shall sell any nonferrous metals exceeding 1 ton unless the other requirement of the notification is satisfied. In other words, the notification imposes in the first instance a general ban on sale of non ferrous metals beyond 1 ton but this coiling is not absolute. Sale beyond 1 ton can be validly effected provided the dealer obtains a declaration in writing from the buyer that the quantity proposed to be sold to him does not exceed his requirement for consumption for three months. It also allows latitude to sell more than 1 ton in the case of a buyer who is a dealer. The effect of the notification, therefore, is that two kinds of ceilings are imposed and thereby two maxima are 632 fixed. Upto 1 ton sale can be effected without any declaration; beyond 1 ton sale can be effected either to a consumer or to a dealer provided the consumer or the dealer makes a declaration that the quantity sold to him does not exceed his requirements for three months. It is common ground that no declaration was given by the respondent to the appellant before the agreement to sell was made, and so the respondent contends that agreement to sell more than 1 ton of the non ferrous metal in question is violative of the requirements of the notification and as such it contravenes section 4(1)(c) read with the notification and attracts section 5(1)(c) of the Act. Mr. Agarwala contends that this notification does not fix the maximum quantity because according to him the requirement of the section can be satisfied by fixing an arithmetical quantity and that too in an immutable form. The argument is that the failure to comply with the provisions of the relevant sections of the Act is made penal, and so it is necessary to fix one maximum quantity in respect of a specified non ferrous metal, and since that has not been done by the notification it is invalid. We are not impressed by this argument. Having regard to the large number of goods intended to be covered by the Act and the variety of circumstances under which they would be required by different classes of persons or dealers it would be enti rely unrealistic to suggest that the maximum which is required to be fixed by section 4(1)(c) is the maximum determined in arithmetical term and fixed immutably in all cases. Besides, section 4(2)(a) itself indicates that different maxima can be prescribed by reference to different localities or different classes of dealers or producers. Therefore, the argument that in the absence of the fixation of any arithmetical quantity of the immutable maximum the notification is bad must be rejected. Then it is urged that the notification is invalid because it is inconsistent with the provisions of section 4(2) (a). It would be noticed that section 4(2)(a) enables the Central Government to fix maximum prices or rates and maximum quantities for the same description of goods 633 differently in different localities or for different classes of dealers or producers. It is urged that the maximum to be fixed under section 4(1)(c) must therefore be the maximum fixed by reference to different classes of dealers or producers, and since the impugned notification does not purport to do so it is inconsistent with section 4(2)(a) and therefore invalid. This contention is clearly misconceived. It is obvious that section 4(2)(a) cannot be read as a proviso and cannot be pressed into service for the purpose of controlling section 4(1)(c). Section 4(2)(a) is an enabling provision and it is intended merely to serve the purpose of showing that notwithstanding the provisions of section 4(1)(c) which refers to persons it may be open to the Central Government to prescribe the maximum either in the way of prices or rates or quantities by reference to different localities or different classes of dealers or producers. Section 4(1)(c) speaks of the fixation of maximum quantity which may in one transaction be sold to any person, and lest it be said that the maximum cannot be fixed in reference to classes of dealers or producers the Legislature has added the enabling provision as section 4(2)(a). Therefore to rely on section 4(2)(a) for the purpose of construing section 4(1)(c) appears to us to be wholly unreasonable. Now, if we look at section 4(1)(c), as we must, it is obvious that the notification is perfectly consistent with section 4(1)(c) inasmuch as it prescribes the maximum by reference to consumers as well as dealers. There is one more argument which has been very strongly pressed before us by Mr. Agarwala which still remains to be considered. He contends that though the notification may have prescribed a maximum quantity under section 4(1)(c) we cannot ignore the fact that as the notification is worded contravention of the requirements of the notification would not attract the provisions of section 5(1)(c) in the present case. The argument is this. The notification prescribes the maximum for sale at any one time, and sale in the context must mean actual sale. The notification therefore cannot refer to or cover cases of agreement to sell or offer to sell. In the present case the appellant no doubt agreed to sell to the respondent a quantity 634 contrary to the condition prescribed by the notification; but, at the stage of the agreement to sell the notification would not apply and so the agreement is perfectly valid. If by his failure to give the necessary declaration the respondent has made the performance of the contract illegal he cannot take advantage of his own default and stamp the whole of the transaction as illegal under section 5(1)(c). In our opinion this argument is based on a misconception of the effect of the provisions of section 4(1)(c) and section 5(1)(c) read together and of the notification issued under section 4(1)(c). The scheme of the two sections is plain. Under section 4(1)(c) the Central Government by a notified order is required to fix the maximum quantity which may be sold to any one person in one transaction, and that the impugned notification has done. Once the maximum is thus fixed by a notified order section 5 immediately comes into operation, and it provides that in regard to commodities the maximum quantity of which has been determined by a notified order under section 4(1)(c) there is a prohibition against agreement to sell, offer for sale, or sale in respect of the said commodities contrary to the requirements of the notification. In other words, once a notified order fixes the maximum in respect of the sale of any goods the agreement to sell the goods or the offer for the sale of such goods above the maximum specified in the notification for the purposes of sale is immediately hit, not by virtue of the notification as such but by the combined operation of the provisions of section 4(1)(c) and the notification issued under it and the provisions of section 5. Therefore, in our opinion, it is futile to suggest that because the notification refers only to sale and not to an agreement to sell section 5(1)(c) would not hit the present contract in suit. In this connection, weight to add that any argument based on the distinction between an agreement to sell and the actual sale as well as on the conduct of the respondent is really not open to the appellant at this stage. The judgment of the learned trial Judge as well as of the Appeal Court clearly show that the appellant 's learned Cousel Mr. Mistree expressly conceded before both the Courts that if under the relevant 635 clause of the notification it is held that a maximum has been validly prescribed then the respondent 's defence would be valid and the appellant would have no case on the point of law. In fact the Appeal Court has referred to this concession more than once in the course of its judgment and it has made it perfectly clear that on the appellant 's side it was expressly stated before the Court that if the point of law raise a by the appellant about the invalidity of the notification failed he would be out of Court. That is why we think that the point raised by Mr. Agarwala that the agreement to sell was valid in this case is really not open to him. It is true that in the trial Court the learned Judge has made certain observations that it appeared to be an implied term of the contract that the buyer would be ready and willing to give the declaration at the time of actual sale and it also appears that the learned Judge thought that it was not open to the respondent to take up the defence about the invalidity of the agreement to sell. It is difficult to see how these observations can be reconciled with the concession made by the appellant 's counsel even before the trial Court; but we have referred to these observations because it is on these observations that Mr. Agarwala wanted to build up an argument that the respondent is precluded from disputing the validity of the agreement to sell and so his default in giving a declaration should be taken into account in dealing with the point of law urged by him. In our opinion, apart from the fact that in view of the concession made by the appellant 's counsel this argument cannot be raised, we are satisfied that there is no substance in it. As we have just indicated the scheme of sections 4(1)(c) and 5 is clear and so any distinction between a sale and an agreement to sell is obviously invalid. That is why we have no doubt that Mr. Mistree was perfectly justified in making the concession that he did. In the result the appeal fails but there would be no order as to costs. Appeal dismissed.

The Supply and Prices of Goods Act, 1950, made provisions for the control of prices, supply and distribution of certain goods essential to the national economy. Section 4(1)(c) empowers the Central Government to fix the maximum quantity of such goods which may be sold to any person in one transaction. Sect ion 4(2)(a) provides that the maximum quantities may be fixed for the same goods differently in different localities or for different classes of dealers or producers. Section 5(1)(c) provides that no dealer or producer shall sell or agree to sell or offer for sale goods exceeding the maximum fixed under section 4. The Central Government issued a notification prohibiting dealers and producers from selling any non ferrous metal exceeding one ton except upon a declaration by the purchaser that the quantity did not exceed his requirements for three months. The appellant entered into an agreement to sell to the respondent 300 tons of zinc. The respondent did not take the entire quantity and the appellant filed a suit for damages for breach of contract. The respondent resisted the suit on the ground that the agreement was void as it offended section 5(1)(c) of the Act. The appellant contended that the notification was invalid as only an immutable arithmetical maximum could have been fixed for each non fer rous metal but the notification did not do so and also as it did not fix the maximum by reference to difference classes of dealers and producers according to section 4(2)(a). It was further contended that the notification applied only to a sale and not to an agreement to sell and as such the agreement did not off end section 52(1)(c). Held, that the notification was perfectly valid and that agreement was void as it offended section 5(1)(c) of the Act. Section 4(1)(c) did not require the fixing of an immutable arithmetical maximum as a large number of goods were intended to be covered by the Act which would be required by different classes of persons under a variety of circumstances. Section 4(2)(a) was merely an enabling provision and did not oblige the Government to fix the maximum differently for different classes of dealers and producers; section 4(z)(a) was not a proviso to section 4(1)(c). Once the maximum was fixed, then by the combined operation of section 4(1)(c) and section 5(1)(c) an agreement to sell or an offer to sell such goods in excess of the maximum was immediately hit, 627

iminal Appeal No. 74 of 1961. Appeal by special leave from the judgment and order dated May 7, 1957, of the Allahabad High Court in Criminal Misc. No. 2006 of 1953. Veda Vyas, section K. Kapur and Ganpat Rai, for the appellant. G.C. Mathur and C. P. Lal, for the respondent. April 27. The Judgment of Gajendragadkar, Sarkar, Wanchoo and Ayyangar, JJ., was delivered by Sarkar, J. Das Gupta, J., delivered a separate Judgment. SARKAR, J. The only question that was argued in this appeal is substantially one of construction of section 99D of the Code of Criminal Procedure. The appellant was the author of two books in Hindi called Sikh Mat Khandan Part 1 and Bhoomika Nazam Sikh Mat Khandan which he had published in April 1953. On July 30, 1953, the Government of Uttar Pradesh, the respondent in this appeal, made an order under section 99A of that Code forfeiting these books which were thereupon seized and taken away. That order, so far as material, was in the following terms: "In exercise of its powers conferred by section 99A of the Code of Criminal Procedure. . the 489 Government is pleased to declare the books forfeited to Government on the ground that the said books contain matter, the publication of which is punishable under section 153 A and 295 A of the Indian Penal Code. " It is the validity of this order that is challenged in the present appeal. Section 99A under which the order was made, so far as relevant, is in these terms: "Where any newspaper, or book or any document appears to the State Government to contain any seditious matter or any matter which promotes or is intended to promote feelings of enmity or hatred between different classes of the citizens of India or which is deliberately and maliciously intended to outrage the religious feelings of any such class by insulting the religion or the religious belief of that class, that is to say, any matter the publication of which is punishable under section 124A or section 153A or section 295A of the Indian Penal Code, the State Government may, by notification in the Official Gazette stating the grounds of its opinion, declare every copy of such book to be forfeited to Government Two things appear clearly from the terms of this section. The first thing is that an order under it can be made only when the Government forms a certain opinion. That opinion is that the document concerning which the order is proposed to be made, contains "any matter the publication of which is punishable under section 124A or section 153A or section 295A of the Penal Code. " Section 124A deals with seditious matters, section 153A with matters prompting enmity between different classes of Indian citizens and section 295A with matters insulting the religion or religious beliefs of any class of such citizens. The other thing that appears from the section is that the Government has to state the grounds of its opinion. The order made in this case, no doubt, stated that in the Government 's opinion the books contained matters the publication of which was punishable under sections 153A and 295A of the Penal Code. It did not, however, state, as it should have, the grounds of that opinion. So it is 490 not known which communities were alienated from each other or whose religious beliefs had been wounded according to the Government, nor why the Government thought that such alienation or offence to religion had been caused. Now section 99B gives the person interested in the books, or documents forfeited, a right to apply to the High Court to set aside the order made under section 99A, and section 99D specifies the High Court 's duty on such an application being made to it. These two sections will have to be especially considered in this case and so they along with section 99C, are set out below. section 99B. Any person having any interest in any newspaper, book or other document, in respect of which an order of forfeiture has been made under section 99A, may, within two months from the date of such order, apply to the High Court to set aside such order on the ground that the issue of the newspaper, or the book or other document, in respect of which the order was made, did not contain any seditious or other matter of such a nature as is referred to in sub section (1) of section 99A. section 99C. Every such application shall be heard and determined by a Special Bench of the High Court composed of three Judges. section 99D. (1) On receipt of the application, the Special Bench shall, if it is not satisfied that the issue of the newspaper, or the book or other document, in respect of which the application has been made, contained seditious or other matter of such a nature as is referred to in sub section (1) of section 99A, set aside the order of forfeiture. We think it fairly clear from these sections that the ground on which an application can be made under section 99B is the ground which, if established, would require the High Court to set aside the order under section 99D. The appellant bad moved the High Court. at Allahabad under section 99B to set aside the order of forfeiture of his books. It seems to have been contended in the High Court that the order of forfeiture should be set aside on the ground that the grounds of the 491 Government 's opinion had not been stated. With regard to this contention, the High Court observed, "The requirement to state the ground is mandatory. A mere citation of words of the section will not do. But as has been held by a Special Bench of this Court in Baijnath vs Emperor (A.I.R. 1925 All. 195), with which we respectfully agree, the High Court in view of the provisions of section 99D of the Code of Criminal 'Procedure is precluded from considering any other point than the question whether in fact the document comes within the mischief of the offence charged. " In this view of the matter the High Court refused to set aside the order on account of the omission to state the grounds of the opinion. The High Court then proceeded to examine the books for itself and found that their contents were "obnoxious and highly objectionable" and dismissed the application observing that the appellant had "entirely failed to show that the books did not contain matters which promoted feelings of enmity and hatred between different classes, or which did not (sic) insult or attempt to insult the religion or religious beliefs of the Sikhs". The present appeal arises out of this order of the High Court. The High Court was of the view that its duty under section 99D was only to see "whether in fact the document comes within the mischief of the offence charged". It thought that a document would be within the mischief of the offence charged if, in its own opinion, it contained matters the publication of which would be punishable under either section 124A, or section 153A or section 295A of the Penal Code as mentioned in the order of forfeiture, irrespective of the Government 's opinion on the matter. Otherwise, it seems to us, the High Court could not uphold the order for the reason that in its view the books offended the Sikhs and the Sikh religion in spite of the fact that there is nothing to show that the Government thought that the books had that effect. The same view appears to have been taken in certain other cases, namely, Premi Khem Raj vs Chief Secretary (1), N. Veerabrahmam vs State of Andhra Pradesh (2) and Baba Khalil Ahmed vs State of U.P. (3). (1) A.I.R. (1951) Raj. (2) A.I.R (1959) A.P. 572. (3) A.I.R. (1960) All. 715. 492 Apparently, it was thought in these cases that the words "if it is not satisfied that. . the book. . contained seditious or other matter of such a nature as is referred to in sub section (1) of section 99A" in section 99D meant, not so satisfied for any reason whatsoever irrespective of the reasons on which the Government formed its opinion about it. We are unable to accept this construction of section 99D. The question is what do the words "matter of such a nature as is referred to in sub section (1) of section 99A" appearing in section 99D mean? Do they mean any matter of that nature as the High Court thought? Or do they mean only those on which the order of forfeiture was based, that is, those which for the reasons stated by it, the Government thought were punishable under one or more of sections 124A, 153A and 295A of the Penal Code mentioned by it?. It seems to us that the latter is the correct view and follows inevitably if sections 99A, 99B and 99D are read together, as they must. Now section 99D is concerned with setting aside an order. That order is one made under section 99A. An order under that section can be made only when certain things have appeared to the Government and the Government has formed a certain opinion. The section further requires the Government to state the grounds of its opinion. It is this order, that is, the order based on the grounds stated, which the party affected has been given by section 99B the, right to move the High Court to set aside. It would follow that all that section 99B can require the party. to do is to show that order was improper. Whether that order was proper or not would, of course, depend onlyon the merits of the grounds on which it was based; whether another order to the same effect could have been made on other grounds is irrelevant, for that would not show the validity of the order actually made; that order would be bad if the grounds on which it is made do not support it. Two orders, though both saying that a pub lication contains matter which offends the same section of the Penal Code cannot be the same or an identical order if the reasons why they are considered so to 493 offend the section of the Penal Code concerned are different. Now section 99B says that a person affected by the order may move the High Court to set it aside on the ground that the book "did not contain any seditious or other matter of such a nature as is referred to in sub section (1) of section 99A". The matter men tioned here must, for the reasons stated, refer only to such matter on which for the grounds stated by it, the Government 's opinion has been based. We proceed now to a. 99D. It is concerned with the same order of forfeiture. An order contemplated by section 99D is made on an application under section 99B. That order must therefore accept or reject the grounds on which the application under section 99B was made. These grounds, as we have seen, are confined to challenging the propriety of the grounds on which the Government 's opinion resulting in the order, was based. The words which we have earlier quoted from section 99B occur substantially in the same form in section 99D. The scope of the two sections is identical. The common words occurring in them must, therefore, have the same meaning in both. They must hence, in section 99D also mean such matters on which for the grounds stated by it the Government 's opinion was based. They cannot mean, as the High Court thought, any matter whatsoever, irrespective of the Government 's reasons for making the order, which in the High Court 's opinion would have justified it. This view of the matter also explains why section 99A requires the Government to state the grounds of its opinion. The reason was to enable the High Court to set aside the order of forfeiture if it was not satisfied of the propriety of those grounds. If it were not so, the grounds of the Government 's opinion would serve no purpose at all. This would specially be so as section 99G provides that an order of forfeiture cannot be called in question except in accordance with the provisions of section 99B. If the order could be upheld, as the High Court seems to have thought, on grounds other than those on which the Government based its opinion, there would have been no need to provide 63 494 that the grounds of the Government 's opinion should be stated; such grounds would then have been wholly irrelevant in judging the validity of the order. The acceptance of the interpretation put by the High Court would lead to a result which, in our view, would be wholly anomalous. The order of forfeiture with which section 99D is concerned is indisputably an order under section 99A. Now, an order under that section is essentially an order of the Government and of no one else. Take a case where the Government making the order states the grounds of its opinion on which the order is based. Suppose the Government says that the expression of view A in the book concerned offends the religious beliefs of community X. Now assume that in an application made to set it aside, the High Court was not satisfied that view A could offend community X but thought that another expression of view in the same book which we will call B, offended the religious beliefs of a different community, say community Y. If in such a case the High Court upheld the order, which, if the view of the Court below is right, it could do, there would really be an order of forfeiture made by the High Court and not by the Government, because the Government in stating the grounds of its opinion had not, since it did not say so, thought that view B could offend the religious beliefs of community Y. We think it impossible that the sections concerned contemplated such a result; the Code nowhere provides for an order of forfeiture being made by the High Court. We are, therefore, of opinion that under section 99D it is the duty of the High Court to set aside an order of forfeiture if it is not satisfied that the grounds on which the Government formed its opinion that the books contained matters the publication of which would be punishable under any one or more of sections 124A, 153A or 295A of the Penal Code could justify that opinion. It is not its duty to do more and to find for itself whether the book contained any such matter whatsoever. What then is to happen when the Government did not state the grounds of its opinion? In such a case 495 if the High Court upheld the order, it may be that it would have done so for reasons which the Government did not have in contemplation at all. If the High Court did that, it would really have made an order of forfeiture itself and not upheld such an order made by the Government. This, as already stated, the High Court has no power to do under section 99D. It seems clear to us, therefore, that in such a case the High Court must set aside the order under section 99D, for it cannot then be satisfied that the grounds given by the Government justified the order. You cannot be satisfied about a thing which you do not know. This is the view that was taken in Arun Ranjan Ghose vs State of West Bengal (1) and we are in complete agreement with it. The present is a case of this kind. We think that it was the duty of the High Court under section 99D to set aside the order of forfeiture made in this case. We accordingly allow the appeal and set aside the Government 's order of forfeiture dated July 30, 1953. The appellant will be entitled to a return of all books, documents and things seized under that order. DAS GUPTA, J. By a notification dated July 30, 1953 the Uttar Pradesh Government acting under section 99A of the Code of Criminal Procedure declared the books "Sikh Mat Khandan, Part 1" and "Bhoomika Nazam Sikh Mat Khandan" which had been published by the appellant Harnam Das in April 1953, forfeited to government on the ground that these books contained matters the publication of which was punishable under section 153A and 295A of the Indian Penal Code. The High Court held on an examination of the books that they clearly came within the mischief of section 153A and section 295A of the Indian Penal Code. Accordingly it held that the order of the State Government forfeiting the two books was eminently just and proper and in that view dismissed the application. One argument appears to have been raised that the order of forfeiture should be set aside as the notification by which the government made the declaration (1) 496 of forfeiture did not state the grounds of the government 's opinion as required by section 99A. The High Court rejected this argument being of opinion that in view of the provisions of section 99D of the Code of Criminal Procedure the High Court was "precluded from consideration of any other point than the question whether in fact the document comes within the mischief of the offence charged. " It is quite clear that the government notification did not state the grounds of the opinion formed by the government that these documents contained matters the publication of which was punishable under section 153A and section 295A of the Indian Penal Code. The question raised before us is whether the High Court was right in rejecting the argument that the order of forfeiture should be set aside on the ground that grounds of the government 's opinion were not stated in the government notification as required by section 99A. The view which prevailed with the learned judges in respect of this question was in accord with what had been held by the same High Court in an earlier case of Baijnath vs Emperor (1) and by the Rajasthan High Court in Premi Khem Raj vs Chief Secretary (2). The same view has later on been taken by the Andhra Pradesh High Court in N. Veerabrahmam vs State Of Andhra Pradesh (3) and by the Allahabad High Court in a later decision in Baba Khalil Ahmad vs State of U. P. (4). A contrary view appears to have been taken by the Calcutta High Court in Arun Ranjan Ghose vs The State of West Bengal (5). The material portion of section 99A is in these words: "Where any newspaper, or book. or any document. appears to the Government to contain any seditious matter or any matter which promotes or is intended to promote feelings of enmity or hatred between different classes of the citizens of India or which is deliberately and maliciously intended to outrage the religious feelings of any such class by insulting the religion or the religious belief of that (1) A.I.R. (1925) All. 195. (2) A.I.R. (1951) Raj. (3) A.I.R. (1950) An. (4) A.I.R. (1960) All, 715. (5) 497 class, that is to say, any matter the publication of which is punishable under section 124A or section 153A or section 295A of the Indian Penal Code, the State Government may, by notification in the Official Gazette stating the grounds of its opinion, declare . every copy of such book. to be forfeited to the government. " It is clear therefore that before any government makes a declaration forfeiting a book under the provisions of this section it has first to be of opinion that the book does contain a matter the publication of which is punishable under section 124A or section 153A or section 295A of the Indian Penal Code. Once it forms such an opinion the government has the power to declare the book forfeited. The section requires that this must be done by a notification in the official gazette and in that notification the government is required to state the grounds on which it formed the opinion. The legislature however did not make such an order made by the government immune from any attack. In section 99B it has provided the means by which the aggrieved person may obtain relief against the order if in fact the government was wrong in its opinion and the book did not contain a matter the publication of which is punishable under section 124A, or section 153A or section 295A of the Indian Penal Code. Section 99B runs thus: "Any person having any interest in any news paper, book or other document, in respect of which an order of forfeiture has been made under section 99A, may, within two months from the date of such order, apply to the High Court to set aside such order on the ground that the issue of the newspaper, or the book or other document, in respect of which the order 'wa s made, did not contain any seditious or other matter of such a nature as is referred to in sub section (1) of section 99A." Section 99D provides that if after hearing the application the High Court is not satisfied that the issue of the document in question contains any seditious matter or any other matter referred to in section 99A, that is to say, any matter the publication of which is 498 punishable under section 124A or section 153A or section 295A of the Indian Penal Code the High Court shall set aside the order of forfeiture. The necessary result of the provision also is that if the High Court is satisfied that the book in question contains matter the publication of which is punishable under section 124A or section 153A or section 295A of the Indian Penal Code, the High Court will refuse to set aside the order of forfeiture. It has to be noticed that section 99B in providing for relief to a person aggrieved by an order of forfeiture has limited the grounds on which relief can be applied for to one and one only, viz., that the issue of the newspaper, or the book or other document, in respect of which the order was made, does not contain any seditious matter or other matter of such a nature as is referred to in sub section (1) of section 99A. The appellant 's contention that the High Court should also examine the notification to find out whether the government had stated the grounds of its own opinion as required by section 99A and set aside the order of forfeiture if it finds that this requirement has note been fulfilled seeks to add an additional ground on which an application can be made under section 99B and relief can be given by the High Court under section 99D. The question is: Can that be done? It is well to recognise that just as a right of appeal is a creature of statute the right to apply for setting aside an order which is really in the nature of an appeal is equally a creature of statute and when the legislature creates such a right by a statute it may at its option make the right unlimited or may limit it in any manner it likes. It is settled law that no Court can add to or enlarge the grounds for appeal as laid down in the statute creating the appeal. The position is exactly the same when the statute creates a right to seek relief by way of application and no court can add to the grounds on which relief can be sought if the statute creating the right to obtain relief is limited to one or more specified grounds. It is interesting to remember in this connection the right to apply for review granted by O. 47 r. 1 of the Code of Civil Procedure. After specifying 499 some grounds on which a review can be applied for, the legislature added a further ground in the words "for any other sufficient reason". The proper interpretation of these words "for any other sufficient reason" has engaged the anxious consideration of the courts and in 1922 the Privy Council after a review of the numerous cases laid down, the rule that "for any other sufficient reason" means a reason sufficient on grounds at least analogous to those specified immediately previously. If the correct position had been that the court might add to the ground for a review whenever it thought fit, all the discussion as regards the interpretation of "for any other sufficient reason" would have been meaningless and unnecessary. Indeed the position in law that the courts cannot add to the grounds to which the legislature has limited the right of relief is so very clear and unassailable that the learned counsel for the appellant did not like to suggest that a ground can be added. To overcome this difficulty that the courts cannot add to the grounds of relief specified in section 99B and section 99D, an ingenious argument has been put forward that in order that the High Court can give proper relief on the very ground mentioned in section 99B and section 99D it is essential that the government 's order should state the grounds of its opinion. The steps of the argument may shortly be stated thus: The government has formed an opinion. The High Court has to see that opinion is correct. In order to do this the High Court must know what weighed with the government in coming to its opinion. Therefore, without the grounds of the Government 's opinion the High Court cannot be satisfied within the meaning of section 99D that the issue of the newspaper contained the matter complained of. The fallacy of this syllogistic process is in the un soundness of the premises that in order to determine whether the government 's opinion is correct or not the High Court must know what weighed with the government. When the application is heard by the High Court and it has to come to a conclusion whether it is or it is not satisfied that the issue of the newspaper, 500 or the book or other document does contain a matter mentioned in section 99A, the one and only way of coming to a conclusion appears to me to be to read the newspaper, or the book or other document. Arguments of counsel might be of assistance; if the government has stated its grounds for coming to its opinion, that would also help; but the ultimate responsibility of deciding whether or not to be satisfied that the issue of newspaper contains matters as mentioned in section 99A can only be discharged by the High Court by reading the document in question. It has been suggested that when section 99B and section 99D uses the words "any seditious or other matter of such a nature as is referred to in sub section (1) of section 99A", they mean only those matters on which the Government based the order of forfeiture; so it is urged, unless the Government stated the ground of its opinion, it will be impossible for the Court to decide the question under section 99D. I confess I do not think it reasonably possible to conceive of a case, where an order under section 99A will not mention the particular matter referred to in section 99A. (1) The mention of the particular matter out of the several matters referred to in section 99A which in its opinion is contained in the document does not however involve the statement of reasons for forming the opinion. Suppose a Government states that in its opinion the document contains seditious matters. It does not cease to be a complete statement on this point merely because the reason for forming the opinion are not also stated. The formation of the opinion that one or more of the matter,% referred to in the section are contained in a document and the statement that such an opinion has been formed are quite distinct from the statement of the reasons for forming the opinion. It appears to me clear that where, as in the present case the Government order contains a statement of the particular matter or matters out of the several matters, referred to in section 99A, viz., any seditious matter or any matter which promotes or is intended to promote feelings of enmity or hatred between different classes of the citizens of India or 501 which is deliberately and maliciously intended to outrage the religious feelings of any such class by insulting the religion or the religious beliefs of that class, that is to say, any matter the publication of which is punishable under section 124A or section 153A or section 295A of the Indian Penal Code" which in its opinion the document contains, no difficulty can possibly arise from the fact that the Court has not got before it Government 's grounds for forming such opinion. But, asks the appellant, why was it necessary then for the legislature to require in section 99A that the Government should state the grounds of its opinion when notifying the order of forfeiture? The real reason, it is urged, was to enable the High Court to set aside the order of forfeiture if it was not satisfied of the propriety of those grounds, and necessarily also when no grounds were stated. If that were correct, it was reasonable to expect the legislature to make the necessary provision in a. 99B that an order could be challenged on the ground that the grounds of the opinion were not stated, and consequential provisions in section 99D. I can see no justification for reading into these sections section 99A and section 99D words which are not there, in an attempt to understand why section 99A contains such a requirement for statement of grounds of the opinion. There can be no doubt that this is a very salutary provision that Government should record the grounds of its opinion. Such a provision diminishes the risk of government making an arbitrary order of forfeiture. It was therefore a question of legislative policy for the legislature to require that the government should state its opinion. To say that there could have been no reason for including such a requirement in section 99A unless the legislature intended the High Court to interfere if grounds of the opinion were not stated, is, in my opinion, wholly unjustified. It seems clear to me that the duty cast by section 99D on the judges of the High Court is not to see whether in a particular case the grounds stated by 64 502 the government for forming its opinion are correct, but to see whether the opinion formed was correct. To perform this duty the one and the only way is to examine the document which in the Government 's opinion contains the matter complained of. The argument that the High Court is not in a position to perform this duty under section 99D satisfactorily in the absence of a statement by the government of the grounds of its opinion appears to me therefore wholly unsound. In this very case, the learned judges of the High Court of Allahabad felt no difficulty in coming to a conclusion on the question before them even though the government had not stated the grounds of its opinion. I fail to see any justification for imagining difficulties where there are none. I have therefore come to the conclusion that the High Court was right in rejecting the argument that the order of forfeiture should be set aside on the ground that the notification did not state government 's grounds for forming the opinion. The appeal should therefore be dismissed. By COURT In view of the opinion of the majority, this appeal will be allowed and the order of the High Court, set aside. The appellant will be entitled to the return of all the books, documents and other things seized from him under the order now set aside. He will also be entitled to the refund of expenses and costs that he had to pay under the order of the High Court.

The respondent passed an order under section 99A of the Code of Criminal Procedure forfeiting two books written by the appellant as in its opinion they contained matter the publication of which was punishable under section 153A and 295A of the Indian Penal Code. The order did not state the grounds on which the respondent had formed this opinion as was required by section 99A. The appellant applied to the High Court under section 99B of the Code to set aside the order. Section 99D of the Code provided that the High Court shall set aside the order of forfeiture if it was not satisfied that the book contained seditious or other matter of such a nature as was referred to in sub section (1) of section 99A. The High Court was of the view that it could not set aside the order under section 99D for the reason that the order did not set out the grounds on which the Government had formed its opinion and that its duty was only to see whether the books in fact came within the mischief of the offence charged. Upon examining the books for itself the High Court came to the conclusion that their contents were obnoxious and highly objectionable and dismissed the application. Held (Per Gajendragadkar, Sarkar, Wanchoo and Ayyangar, jj. Das Gupta, J. contra) that on the failure of the respondent to set out the grounds of its opinion as required by section 99A of the Code the High Court should have set aside the order under section 99D. It is the duty of the High Court under that section to set aside the order of forfeiture if it is not satisfied that the grounds on which the Government formed its opinion could justify that opinion. Where no grounds of its opinion are given at all the High Court must set aside the order for it cannot then be satisfied that the grounds given by the Government justified the order. Arun Ranjan Ghose vs State of West Benaal, (1955) 59 C.W.N. 495, approved. Premi Khem Rai vs Chief Secretary, A.I.R. (1951) Raj. II3, N. Veerabrahmam vs State of Andhra Pradesh, A.I.R. (1959) A. Pr. 572 and Baba Khalil Ahmed vs State of U. P., A.I.R. (1960) All. 715, disapproved. 488 Per Das Gupta, J. The High Court had no power to set aside the order on the ground of failure of the Government to set out the grounds of its opinion in the order. The duty cast on the High Court is not to see whether the grounds stated by the Government for forming its opinion are correct but to see whether the opinion formed is correct; this can only be done by examining the books. Section 99B has limited the grounds on which relief can be asked for to one and one only, viz., that the books do not contain any objectionable matter. It was not permissible for courts to add to that ground. Baijnath vs Emperor A.I.R. (1925) All. 195, Premi Khem Raj vs Chief Secretary, A.I.R. (1951) Raj. 113, N. Veerabrahmam vs State of Andhra Pradesh, A.I. R. 1959 A. Pr. 572 and Baba Khalil Ahmed vs State of U. P., A.I.R. (1960) All. 715, approved. Arun Ranjan Ghose vs The State of West Bengal, , disapproved.

146 of 1958. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. Veda Vyasa, section K. Kapur and Ganpat Rai, for the petitioners. C. K. Daphtary, Solicitor General of India, R. Gopala krishnan and D. Gupta, for the respondents. May 2. The Judgment of the Court was delivered by SINHA, C. J. The petitioners have moved this sin Court under article 32 of the Constitution for a writ 646 or order in the nature of mandamus and/or prohibition and/or other suitable writ, order or direction to the respondents not to levy, charge or collect any sales tax on transactions of what the petitioners characterised as hire purchase agreements, a typical example of which is contained in Annexure 'A ' to the petition, to be hereinafter examined in detail. The first petitioner is a private limited company incorporated under the Companies Act, with its registered office at Janpath, New Delhi. The second petitioner is the Managing Director and shareholder of that company and is directly interested in the result of this application, because it is claimed that his rights and property are directly involved. The company has been carrying on in Delhi the business of financing the purchase of new as well as second hand motor cars and other kinds of motor vehicles. The system adopted by the Company for financing a purchase such as aforesaid is as follows. A person desiring to purchase a motor vehicle fixes a bargain with the owner and the petitioner Company would then advance the necessary finance on the terms and conditions appearing in a printed copy of the agreement, marked Annexure 'A ' to the petition. According to that agreement, the Company charges the 'Hirer ' an initial deposit by way of premium as a consideration for granting the lease of the vehicle, which deposit becomes the absolute property of the Company; the premium charged as aforesaid is a substantial amount, being usually 25% of the price in respect of new vehicles. The 'Hirer ' undertakes to pay instalments and when all the instalments are paid, the vehicle becomes the property of the 'Hirer ' at his option, on payment of rupee one to the Company, as a consideration for the option; until all the stipulated instalments have been paid and the option exercised as aforesaid, the vehicle remains the property of the Company as owners. The 'Hirer ' is delivered possession of the vehicle and he remains responsible to the Company for damage or destruction or loss. The 'Hirer ' has to pay interest at the rate of one per cent. per mensem on all sums overdue. Until the option of 647 purchase is exercised by the 'Hirer ', he is at liberty to return the vehicle and to put an end to tile Hiring Agreement, on certain terms. Thus, under the agreement, the 'Hirer ' has the use of the vehicle, which is entrusted to him as the property of the Company, and it is open to the 'Hirer ' to become the purchaser of the vehicle as aforesaid, but he is not bound to do so. The hire money received by the Company, it is contended, is not a part of the price of the goods sold and is thus not liable to be taxed as sale price. The Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941) was extended to the State of Delhi, which is now the Union Territory of Delhi. In pursuance of the provisions of that Act, the Sales Tax authorities started demanding and levying sales tax on all transactions of the nature aforesaid on the ground that the instalments paid by the hirers to the Company were sales price and, therefore, liable to Sales Tax. The Company challenged the right of the Sales Tax authorities to levy any such tax on the ground that the law was beyond the competence of the legislature. Ultimately, the Company moved the Punjab High Court (Circuit Bench at Delhi) under articles 226 and 227 of the Constitution. In the Writ Petition, which was registered as Civil Writ Application No. 289 D of 1954, the Company prayed for a writ in the nature of prohibition and/or mandamus restraining the respondent from realising or levying any sales tax under the provisions of the Bengal Act, extended to Delhi. There was also a prayer for a writ of certiorari quashing certain orders passed by the Sales Tax authorities in 1953 54. The said application was heard by a, Division Bench, which allowed the petition and issued a mandamus to the State to forbear from enforcing its notice for the realisation of the Sales Tax. It was held by the High Court that the State Legislature had not the power to enlarge the meaning of the words "Sale of Goods" by going beyond the meaning attached to it by the Sale of Goods Act. After tile judgment aforesaid of the High Court of Punjab, it is further alleged, a settlement was arrived at between the companies carrying on hire purchase 648 business in Delhi and the Commissioner of Sales Tax, who issued a circular, being Circular No. 10 of 1956, containing the following decisions of the Department: "(i) Companies which are exclusively engaged in the hire purchase business will not be treated as dealers and their certificate of registration will be cancelled. (ii) Companies which are partially engaged in the business of hire purchase will continue to be dealers as hitherto fore and their hire purchase transactions will be appropriately examined in the light of the judgment of the Punjab High Court, and will be liable to Sales Tax at one stage. (iii) As a result of (i) above, sales made to the above Companies by the dealers in vehicles would be liable to Sales Tax at the hands of the latter. (iv) In respect of vehicles, and machineries, etc., for which tax has been paid, at the time of purchases thereon from the market, no Sales Tax would be payable in respect of hire monies collected on them by the hire purchase companies or on their resale or rehire following repossession or on the exercise of the option of purchases by the hirer. (v) In respect of second hand vehicles purchased by the companies from private individuals for purposes of hire purchase, the companies will not be liable to any sales tax either at the time of purchase or in respect of subsequent transaction thereon. The Companies will be as other nonregistered dealers, in view of (i), their Registration Certificates in respect of Hire purchase business having been cancelled. (vi) The assessment which are already made will not be reopened except in the case of M/s. Installment Supply Co. Ltd. for which there are specified orders of the High Court. (vii) In their up to date assessment, the hire purchase Companies should take upon themselves the responsibility to pay tax which they have save by making tax free purchases either from dealers or from non registered dealers. The assessment will, however, be made accordingly as before in the normal way. " 649 Thereafter in the case of Mithan Lal vs State of Delhi (1) this Court examined the vires of the Bengal Finance (Sales Tax) Act, 1941, as extended to Delhi, and came to the, conclusion that the law had been validly promulgated. According to that decision, the definition of 'sale ' could be legally extended so as to make it permissible to tax sale of goods involving the supply of materials in pursuance of building contracts. As a result of the decision aforesaid of this Court, a press note was issued by the Commissioner of Sales Tax, Delhi, to the effect that provision regarding levy of tax on hire purchase transactions was valid and that all hire purchase dealers as come within the purview of sections 4 and 7 of the Bengal Finance (Sales Tax) Act, 1941, as extended to Delhi, are liable to pay sales tax and to get themselves registered under the Act; that all such hire purchase dealers as were formerly registered with the Sales Tax Department shall be deemed to be registered with effect from the first of April, 1958 for the purpose of the Act and that all hire purchase dealers who had not got themselves registered so far should immediately have themselves so registered in order to avoid being penalised for contravention of the provisions of the Act. In pursuance of the aforesaid circular of the Department, the petitioner company was also called upon to comply with the requirements of the Act. The Company made representation to the Commis sioner of Sales Tax that the Company and other such companies which deal in hire purchase were not liable to pay sales tax, but the Commissioner of Sales Tax refused to accept the Company 's contention and answered to the following effect: "1. The incidence of Sales Tax on such transactions is to be governed by the provisions of Sections 3 and 4 of the . If however, the vehicles are purchased by a Company having its place of business in Delhi from a dealer outside Delhi on payment of Sales Tax of that State and the vehicle is hire purchased to the party in that very State, neither Delhi Sales Tax (1) ; 650 nor Central Sales Tax will be leviable on the Delhi firm irrespective of the fact that the Hire purchase Agreement is entered into at Delhi. If, however, vehicle is purchased in State 'A ' but is hire purchased to a party in State 'B ', Central Sales Tax will be leviable in the State according to the rules in force in that State. The hire purchase transactions of secondhand vehicles, where the owner approaches the Hire Purchase Co. for finances against the vehicles, will be leviable to Sales Tax, because according to the Hire purchase Agreement the property in the vehicle vests in the Hire Purchase Co. and this property is to be transferred to the so called owner by virtue of the Hire purchase transactions. Secondhand vehicles purchased outside Delhi and hire purchased to the parties outside Delhi or hire purchase transactions conducted outside Delhi in which owner approaches the Hire purchase Co. for finance will be governed by the clarification given in 1 above. In the case of vehicles purchased by the Hire purchase Companies from the local registered dealers, they will not be required to pay any Sales Tax because all Hire purchase companies will be registered and will be entitled to make tax free purchases of such vehicles. It is, therefore, regretted that it is not possible to accede to the request made in this behalf. Sales Tax will be payable on total amounts charged by the Hire purchase Co. from the hirer and it is not possible to waive Sales Tax on the so called incidental charges. It is regretted that it is not possible to alter the date of liability of the Hire purchase Co. which has already been fixed with effect from 1st of April, 1958, in pursuance of the Supreme Court Judgment. It is true that the Press Note was issued in the month of June and so Hire purchase Companies have been making purchases of vehicles on payment of sales tax. The Hire purchase companies are advised to approach the dealers for 651 refund of the Sales Tax paid by them on such purchases. If, however, it is not possible for any Hire Purchase Co. to obtain refund of the Sales Tax so paid by them, the amounts so paid may be adjusted towards their liability on the hire purchase transactions. " On receipt of the answer of the Department, as set out in the previous paragraphs, the petitioners moved this Court under article 32 of the Constitution on the ground that the "threatened action of the respondents is illegal and unconstitutional as the petitioner company is not liable to pay sales tax on the transactions" described above. In support of the petition, the learned counsel for the petitioners has raised the following contentions: (1) that the transactions in respect of which the petitioners are sought to be taxed are not covered by the explanation to section 2(g) of the Bengal Finance (Sales Tax) Act, as extended to Delhi; (2) alternatively, that is to say, if it is held that the explanation covers the transactions of the nature aforesaid, then the explanation, extending the concept of 'sale ' is unconstitutional; (3) That in any case it is unconstitutional as it infringes article 14 of the Constitution in so far as the State of Delhi has been selected for hostile discrimination; (4) that the judgment of the Punjab High Court in Installment Supply Ltd., New Delhi vs State of Delhi (1) is final and conclusive as between the parties to that judgment; (5) that if it is held that the judgment of the Punjab High Court, referred to above, has been superseded by the judgment of this Court in Mithan Lal 's case (2), that judgment cannot be given retrospective operation; and (6) lastly, that the settlement between the Department and the Companies transacting business in "Hire purchase" is binding until the decision of this Court in Mithan Lal 's case (3), aforesaid. We shall examine these arguments in the order in which they have been stated. The most important question in this case is: What (1) A.I.R. 1956 Puaj. (2) [1959] S.C.R 445. 652 is the true nature and character of the transaction which is the subject matter of the present controversy? Do the terms and conditions of the agreement typified by Annexure 'A ' to the petition, as described above, constitute a mere agreement of hiring, as contended on behalf of the petitioners, or do they constitute a contract of hire purchase, within the meaning of explanation (1) to the definition of 'sale ' contained in the statute in question, as contended on behalf of the respondents? There is no doubt that the concept of 'sale ', as it appears from the following words of the definition, along with explanation (1), is rather extended. In the definition of the term 'sale ' for the purposes of the Act, the words are as follows: " 'Sale ' means any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods involved in the execution of a contract, but does not include a mortgage, hypothecation, charge or pledge. Explanation I. A transfer of goods on hire purchase or other instalment system of payment shall, notwithstanding that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale. " It is clear from the definition that it includes not only what may be compendiously described as a sale under the Sale of Goods Act, but also transactions, which, strictly speaking, are not sales, not even 'contracts of sale ' but only contain an element of sale, that is the option to purchase, and that is the reason why the explanation ends with the words "be deemed to be a sale", thereby indicating that a legal fiction has been introduced into the concept of sale ' as ordinarily understood. The explanation has included within its amplitude a mere transfer of goods without the transfer of title to the goods, if it is in the course of an agreement of the nature of "hire purchase", or other instalment system of payment. A contract of hiring, under the Common Law, is one of the species of a contract of bailment and has, during the last 60 70 653 years, undergone a series of refinements as a result of modern industrial and commercial developments. The term 'hire purchase ' has not been defined in the Act. We have, therefore, to construe the expression in its ordinary Common Law sense, which may best be expressed in terms of the Dictionary of English Law by Earl Jowitt at pages 913 914, which runs as follows: "Hire purchase a system whereby the owner of goods lets them on hire for periodic payments by the hirer upon an agreement that when a certain number of payments have been completed, the absolute property in the goods will pass to the hirer, but so that the hirer may return the goods at any time without any obligation to pay any balance of rent accruing after return; until the conditions have been fulfilled, the property remains in the owner. The instrument by which the hire purchase is effected does not ordinarily require registration as a bill of sale (Exp. Crawcour ; the hirer is 'reputed owner ' within the Bankruptcy Act, 1914 (Exp. Brooks ; but the hirer does not 'agree to buy ' within the Factors Act or the Sale of Goods Act, 1893, so as to be able to sell or pledge the goods as if he were a mercantile agent (Helby vs Matthews ; Brooks vs Bernstein (1909) 1 K.B. 98). Such agreements are to be distinguished from agreements such as in Lee vs Butler , which are in fact a sale, the price being paid in instalments with the condition that the property passes when all the instalments have been paid; here there is a binding agreement for the party to purchase, where in a true hire purchase agreement there is not. " In Halsbury 's Laws of England, Third Edition, Volume 19, paragraph 823, at pages 510 511, the nature of a hire purchase transaction is thus expressed: "The contract of hire purchase is one of the variations of the contract of bailment, but it is a modern development of commercial life, and the rules with regard to bailments, which were laid down before 83 654 any contract of hire purchase was contemplated, cannot be applied simpliciter, because such a contract has in it not only the element of bailment but also the element of sale. At common law the term 'hire purchase ' properly applies only to contracts of hire conferring an option to purchase, but it is often used to describe contracts which are in reality agreements to purchase chattels by instalments, subject to a condition that the property in them is not to pass until all instalments have been paid. The distinction between these two types of hire purchase contracts is, however, a most important one, because under the latter type of contract there is a binding obligation on the hirer to buy and the hirer can therefore pass a good title to a purchaser or pledge dealing with him in good faith and without notice of the rights of the true owner, whereas in the case of a contract which merely confers an option to purchase there is no binding obligation on the hirer to buy, and a purchaser or pledge can obtain no better title than the hirer had, except in the case of a sale in market overt, the contract not being an agreement to buy within the Factors Act, 1889, or the Sale of Goods Act, 1893." The observations quoted above are based mostly on two leading cases which have come to be regarded as the locus classics upon the subject, namely, Lee vs Butler (1) in which the transaction was described by Lord Esher, M.R., as "Hire and Purchase Agreements" and Helby vs Matthews (2) in which the House of Lords distinguished the former case on the ground that in that case there was a binding contract to buy and not merely an option to buy, without any obligation to buy. Both these cases were decided in terms of Factors Act of 1889 (52 & 53 Vict. c. 45, section 9). Both the kinds of agreements exemplified by the two leading cases aforesaid would now be included in the definition of 'hire purchase ' as contained in section 21 of the Hire Purchase Act, 1938 (1 & 2 Geo., 6, c. 53): " 'Hire purchase agreement ' means an agreement for the bailment of goods under which the bailer (1) (2) 655 may buy the goods or under which the property in the goods will or may pass to the bailee, and where by virtue of two or more agreements, none of which ' by itself constitutes a hire purchase agreement, there is a bailment of goods and either the bailee may buy the goods, or the property therein will or may pass to the bailee, the agreements shall be treated for the purposes of this Act as a single agreement made at the time when the last of the agreements was made. " It is clear that under the Law, as it now stands, which has now been crystallised into the section of the Hire Purchase Act, quoted above, the transaction partakes of the nature of a contract or bailment with an element of sale, as aforesaid, added to it. In such an agreement, the hirer may not be bound to purchase the thing hired; he may or may not be. But in either case, if there is an obligation to buy, or an option to buy, the goods delivered to the hirer by the owner on the terms that the hirer, on payment of a premium as also of a number of instalments, shall enjoy the use of the goods, which ultimately may become his property, the transaction amounts to one of hire purchase, even though the title to the goods has remained with the owner and shall not pass to the hirer until a certain event has happened, namely, that all the stipulated instalments have been paid, or that the hirer has exercised his option to finalise the purchase on payment of a sum, nominal or otherwise. But it has been contended on behalf of the petitioners that there is no binding agreement to purchase the goods and that title is retained by the owner not as a security for payment of the price but absolutely. According to third term of the agreement, on the hirer duly performing and observing the terms of the agreement, with particular reference to the payment of the monthly instalments, "the hiring shall come to an end and the vehicle shall, at the option of the hirer, become his absolute property; but until such payments as aforesaid have been made, the vehicle shall remain the property of the owners. The hirer shall also have the option of purchasing the vehicle at any 656 time during the currency of this Agreement, by paying in one lump sum the balance of all the hire hereinbefore mentioned and any other expenses incurred by the owners relating to the transaction. " It is clear, therefore, that in addition to the contract of hiring an option has been given to the hirer to purchase or not to purchase. The more serious question on this part of the petitioners ' contention is whether the non obstante clause in the explanation "notwithstanding that the seller retains a title to any goods as security for payment of the price" governs the main clause of the explanation. In our opinion, it does not. The non obstante clause has been added only to emphasise the categorical statement of the law contained in the main clause to the effect that a transfer of goods on hire purchase, etc., shall be deemed to be a sale ' even though there may be a stipulation to the effect that in spite of the transfer of goods to the hirer, the owner retains title to those goods until the happening of the ultimate event, namely, completion of title at the option of the hirer. There is, thus, no doubt that the agreement in question does contain not only a contract of bailment simpliciter but also an element of sale, which element has been seized upon by the legislature for the purpose of subjecting a transaction like that to the Sales Tax. This leads us to the second ground of attack raised by the petitioners, namely, that the explanation, if it has the effect of extending the concept of 'sale ' to what, in law, is not a real sale, but only an incipient or inchoate sale, then in so far as the law has extended the definition of sale ' it is unconstitutional. This contention has lost all its force, if ever it had any, in view of the decision of this Court in Mithan Lal 's case (1). But then it is argued that Mithan Lal 's case (1) requires reconsideration and that, in any view of the matter, this Court did not consider the further attack based on article 14 of the Constitution. It is true that in Mithan Lal 's case (1) the contention that the enactment in question had infringed article 14 of the (1) ; 657 Constitution had not been raised. This Court, therefore, had no occasion to pronounce on that aspect of the controversy We have, therefore, to consider the contention under head (3), namely, that though the Parliament may have had the power to tax something which was not strictly speaking a 'sale ', the law is open to the attack that it discriminates against traders in Delhi inasmuch as, it is further contended, such a law has not been made applicable to the whole of India. In our opinion, there is no substance in this contention because no proper foundation was laid in the pleadings for supporting such a contention. It has not been averred that other Part II States have not been similarly treated. On the other hand, it does appear that under the (LXXIV of 1956), the definition of 'Sale ' contains the extended definition, without the non obstante clause, discussed above. Section 2(g) of the , has the following definition: " 'Sale ' with its grammatical variations and cognate expressions, means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes a transfer of goods on the hire purchase or other system of payment by instalments, but does not include a mortgage or hypothecation of or a charge or pledge on goods. " It would, thus appear 'that hire purchase transactions have been included within the definition of sale ' for the purpose of Central Sales Tax, and this definition has become applicable throughout India, and it cannot, therefore, be said that the State of Delhi, and now the Union Territory of Delhi, has been selected for hostile discrimination. In our opinion, therefore, there is no substance in the contention that the extended definition of ',sale ' in the main statute infringes article 14 of the Constitution. Now, the remaining contentions raised on behalf of the petitioners may be disposed of by observing that what the Sales Tax Department does, or does not do, cannot change the law. The Department issued its 658 instructions to the Sales Tax Officers, in conformity with the law as laid down in the judgment of the Punjab High Court in Instalment Supply Ltd., New Delhi vs State of Delhi (1). This Court later laid down the law more authoritatively in Mithan Lal 's s case (2) and the Department was bound to take notice of what this Court had laid down. It cannot, therefore, be argued that the Department had, in any sense estopped itself by issuing those instructions, or that this Court, by laying down the law in Mithan Lal 's case (2) had laid down a new rule of law which has no application to pending proceedings for levy, assessment and realisation of sales tax, either in Delhi or elsewhere. There is another answer to the point of res judicata raised on behalf of the petitioners, relying upon the decision of the Punjab High Court in Instalment Supply Ltd., New Delhi vs State of Delhi (1). It is well settled that in matters of taxation there is no question of res judicata because each year 's assessment is final only for that year and does not govern later years, because it determines only the tax for a particular period. (See the decision in the House of Lords in Society of Medical Officers of Health vs Hope (Valuation Officer) (3) approving and following the decision of the Privy Council in Broken Hill Proprietary Company Limited vs Municipal Council of Broken Hill (4). As all the contentions raised on behalf of the petitioners fail, this petition is dismissed with costs. Petition dismissed. (1) A I.R. 1956 Punj I77.

Section 2(g) of the Bengal Finance (Sales Tax) Act, 1941, as extended to Delhi State, provided as follows, " 'Sale ' means any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods involved in the execution of a contract, but does not include a mortgage, hypothecation, charge or pledge. Explanation I. A transfer of goods on hire purchase or other instalment system of payment shall, notwithstanding that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale. " The hire purchase agreement entered into by the petitioner company provided that after all the monthly instalments had been paid, "the hiring shall come to an end and the vehicle shall, at the option of the hirer, become his absolute property; but until such payments as aforesaid have been made, the vehicle shall remain the property of the owners. The hirer shall also have the option of purchasing the vehicle at any time during the currency of this agreement by paying in one lump sum the balance of all the hire hereinbefore mentioned and any other expenses incurred by the owners relating to the transaction. " The question for determination was whether the agreement was a transaction of mere hiring or one of hire purchase within the meaning of Explanation 1 to section 2(g) of the Act. 645 Held, that the language of Explanation 1 to section 2(g) of the Act was wide enough to include a mere transfer of goods without the transfer of the title thereto, if such transfer took place in the course of an agreement of hire purchase or any other instalment system of payment. As the Act did not define the term 'hire purchase ', it had to be construed in its ordinary Common Law sense, i.e., that it partook of the nature of a contract of bailment with an element of sale added to it. Lee vs Butler, [1893] z Q. B. 318 and Helby vs Matthews, , referred to. The non obstacle clause in Explanation 1 to section 2(g) of the Act did not govern the main clause of the said Explanation and its sole purpose was to emphasise the categorical statement of the law Contained therein. Since the agreement in the instant case contained not merely a contract of bailment simpliciter but also an element of sale, the transaction had rightly been subjected to sales tax. There could be no force in the contention that the Act in so far as it sought to extend the concept of sale to what in law was not a real sale, was unconstitutional. Mithan Lal vs State of Delhi, ; , referred to. Nor was there any substance in the contention that the extended definition of the word 'sale ' in the Act infringed article 14 of the Constitution. It is well settled that in matters of taxation there can be no question of res judicata. Society of Medical Officers of Health vs Hope (Valuation Officer), and Broken Hill Proprietary Company Ltd. vs Municipal Council of Broken Hill, [1925] A. C. 94, referred to. Installment Supply Ltd., New Delhi vs State of Delhi, A.I.R. 1956 Punj. 177, considered.

minal Appeal No. 220 of 1960. Appeal from the judgment, and order dated August 4, 1960, of the Punjab "High Court, in Criminal Revision No. 31 D of 1960. C. K. Daphtary, Solicitor General of India, R. H. Dhebar and D. Gupta, for the appellant. The respondent did not appear. May 3. The Judgment of K. Subba Rao and Raghubar Dayal, JJ., was delivered by Raghubar Dayal, J. J. R. Mudholkar, J., delivered a separate judgment. RAGHUBAR DAYAL, J. The only point for consideration in this appeal, by certificate granted by the High Court of Judicature at Punjab, is whether a police officer, who is neither a special police officer under the Suppression of Immoral Traffic in Women and Girls Act, 1956 (Act CIV of 1956), hereinafter called the Act, nor a police officer subordinate to a special police officer, can validly investigate the offences under the Act. Ram Singh, respondent, was suspected of having committed an offence under section 8 of the Act. Jet Ram, Sub Inspector, who had not been appointed a special police officer by the State Government, investigated the case and submitted the charge sheet to the Magistrate. The Magistrate quashed the charge sheet, holding that the special police officer alone was competent 696 to investigate the case and that Jet Ram could not have investigated it. On revision by the State, the High Court agreed with the view of the Magistrate and dismissed the revision. The High Court, however, granted a certificate under article 133(1)(c) of the Constitution and hence this appeal by the Delhi Administration. The learned Solicitor General, appearing for the Delhi Administration, has submitted that in the absence of any definite provision in the Act de barring the police to exercise its powers with respect to cognizable offences, the regular police can exercise those powers and that, consequently there is nothing wrong in the Sub Inspector of the regular police making an investigation in a case under the Act. He also submits that the special police officer is not competent to investigate offences, his powers being confined to what may come within the expression 'dealing with offences under the Act ', and which expression, accord ing to him, does not cover the power to investigate into offences. It is urged for the respondent that it is only the special police officer who is competent to investigate the offences under the Act. Before dealing with the merits of the question for determination, we may set out the object of the enactment and the relevant provisions thereof. The Act was enacted in pursuance of the International Convention signed at New York on the 9th day of May, 1950, for the suppression of immoral traffic in women and girls. Section 2 deals with definitions and, according to its clause (1), special police officer ' means a police officer appointed by or on behalf of the State Government to be in charge of police duties within a specified area for the purposes of the Act. Sections 3 to 9 create new offences and provide punishment for them. It is not necessary to detail the nature of the offences. Section 10 deals with release of convicted persons convicted for certain offences, on probation of good conduct, in the manner provided in sub section (1) of section 562 of the Code of Criminal Procedure, hereinafter called 697 the Code, or with admonition as provided in sub section (1A) of section 562 of the Code. Certain provisions of sections 562, 563 and 564 apply to such cases. The provisions of section 11 of the Act correspond to those of section 565 of the Code. Section 12 provides for taking security for good behaviour from habitual offenders at the time of passing sentence on them and thus correspond, in a way to the provisions of section 106 of the Code. The provisions of sections 112 to 126 of the Code apply to such a case. Sections 13, 14, 15 and 16 of the Act are as follows: "13. (1) There shall be for each area to be specified by the State Government in this behalf, a special police officer appointed by or on behalf of that Government for dealing with offences under this Act in that area. (2) The special police officer shall not be below the rank of (a) an Assistant Commissioner of Police in the presidency towns of Madras and Calcutta; (b) a Superintendent of Police in the presidency town of Bombay; and (c) a Deputy Superintendent of Police else where. (3) For the efficient discharge of his functions in relation to offences under this Act (a) the special police officer of an area shall be assisted by such number of subordinate police officers (including women police officers wherever practicable) as the State Government may think fit; and (b) the State Government may associate with the special police officer a non official advisory body consisting of not more than five leading social welfare workers of that area (including women social welfare workers wherever practicable) to advise him on questions of general importance regarding the working of this Act. Notwithstanding anything contained in the Code of Criminal Procedure ' 1898 (5 of 1898) any offence punishable under this Act shall be deemed to 698 be a cognizable offence within the meaning of that Code: Provided that, notwithstanding anything contained in that Code, (i) arrest without warrant may be made only by the special police officer or under his direction or guidance, or subject to his prior approval; (ii) when the special police officer requires any officer subordinate to him to arrest without warrant otherwise than in his presence any person for an offence under this Act, he shall give that subordinate officer an order in writing, specifying the person to be arrested and the offence for which the arrest is being made; and the latter officer before arresting the person shall inform him of the substance of the order and, on being required by such person, show him the order; (iii) any police officer not below the rank of inspector specially authorized by the special police officer may, if he has reason to believe that on account of delay involved in obtaining the order of the special police officer, any valuable evidence relating to any offence under this Act is likely to be destroyed or concealed, or the person who has committed or is suspected to have committed the offence is likely to escape, or if the name and address of such a person is unknown or there is reason to suspect that a false name or address has been given, arrest the person concerned without such order, but in such a case be shall report, as soon as may be, to the special police officer the arrest and the circumstances in which the arrest was made. (1) Notwithstanding anything contained in any other law for the time being in force, whenever the special police officer has reasonable grounds for believing that an offence punishable under this Act has been or is being committed in respect of a woman or girl living in any premises, and that search of the premises with warrant cannot be made without undue delay, such officer may, after recording the grounds of his belief, enter and search such premises without a warrant. (2) Before making a search under sub section (1), 699 the special police officer shall call upon two or more respectable inhabitants (at least one of whom shall be a woman) of the locality in which the place to be searched is situate, to attend and witness the search, and may issue any order in writing to them or any of them so to do. (3) Any person who, without reasonable cause, refuses or neglects to attend and witness a search under this section, when called upon to do so by an order in writing delivered or tendered to him, shall be deemed to have committed an offence under section 187 of the Indian Penal Code (45 of 1860). (4) The special police officer entering any premises under sub section (1) shall be entitled to remove therefrom any girl, if in his opinion she is under the age of twenty one years and is carrying on or is being made to carry on, or attempts are being made to make her carry on, prostitution. (5) The special police officer, after removing the girl under sub section (4) shall forthwith produce her before the appropriate magistrate. (6) The special police officer and other persons taking part in, or attending, and witnessing a search shall not be liable to any civil or criminal proceedings against them in respect of anything lawfully done in connection with, or for the purpose of, the search. (1) Where a magistrate has reason to believe from information received from the police or other. wise, that a girl apparently under the age of twenty. one years, is living, or is carrying on, or is being made to carry on prostitution, in a brothel, he may direct the special police officer to enter such brothel, and to remove therefrom such girl and produce her before him. (2) The special police officer after removing the girl shall forthwith produce her before the Magistrate issuing the order. " Section 17 provides for intermediate custody of girls removed under section 15 or rescued under section 16. Sections 18 to 21 provide for matters unconnected with offences. 700 Section 22 provides that no Court inferior to that of a Magistrate as defined in cl. (c) of section 2 shall try the offences mentioned in the section. The Magistrates mentioned in this clause are District Magistrates, Sub Divisional Magistrates, Presidency Magistrates or a Magistrate of the First Class specially empowered by the State Government by notification in the official gazette to exercise jurisdiction under the Act. It is clear from the various provisions that the Act is a complete Code with respect to what is to be done under it. It deals with the suppression of immoral traffic in women and girls, a matter which has to be tackled with consideration, intelligence and understanding of the problem. This is evident from the provisions of cl. (b) of sub section (3) of section 13 which provides for the association of a non official advisory body consisting of not more than five leading social welfare workers of that area (including women social welfare workers wherever practicable) with the special police officer in order to advise him on questions of general importance regarding the working of the Act. The Act creates new offences, provides for the forum before which they would be tried and the orders to be passed on conviction of the offenders. Necessary provisions of the Code of Criminal Procedure have been adopted fully or with modifications. The Act provides machinery to deal with the offences created and its necessary implication must be that new machinery is. to deal with those offences in accordance with the provisions of the special Act and, when there is no specific provision in such Act, in accordance with the general procedure and that no other machinery is to deal with those offences. It does not appear reasonable that the investigation of offences would have been left unprovided and was to be done by the regular police, in accordance with the regular procedure laid down under the Code. On the other hand, there are certain provisions which are such that the regular police cannot comply with them and thus they point to the conclusion that it is the special police officer alone who is to take any 701 action which the police has to take in connection with the offences under the Act. Section 14 makes offences under the Act cognizable, which, according to the Code means that persons accused of those offences can be arrested without a warrant, and section 157 of the Code specially mentions that the investigating officer, if necessary, is to take measures for the discovery and the arrest of the offender; and yet, the power to arrest without a warrant is not given to the regular police, but under the proviso to this section, is to be exercised by the special police officer or under his direction or guidance or subject to his prior approval. The provisions of proviso (iii) correspond to the provision of section 57 of the Code and others refer to special circumstances in which a police officer not below the rank of an inspector specially authorised by the special police officer can arrest without warrant. Section 15 provides for searches without warrant, by the special police officer. This section does not specifically state that the special police officer alone will,search without warrant, but it is clear from the provisions of this section that officers of the regular police force will not search without warrant and thus will not exercise the power given under section 165 of the Code. All the provisions of section 15 correspond to those of section 165 of the Code. Further, in view of sub section (2) of section 15, the special police officer is required to include at least one woman among the search witnesses. There is no such restriction in section 103 of the Code. If a regular police officer is to conduct search in pursuance of the powers conferred under section 165 of the Code, he is not bound to include a woman among the search witnesses. Further, sub sections (4) and (5) of section 15 authorise a special police officer to remove any girl found in the promises searched, if she be under twenty one years of age and is carrying on prostitution. Such a girl is to be pro duced before the appropriate Magistrate. The ordinary regular police officer conducting search under section 165 of the Code, will not be able to do anything with respect to such a girl found in the premises 89 702 searched by him. These provisions clearly indicate that the regular police officers are not to exercise any powers in connection with the offences and the other purposes of this Act. The entire police duties in connection with the purposes of the Act within a certain area have been put in the charge of a special police officer. There must be a definite purpose behind the provision of appointing a police officer in charge of the police duties within a specified area for the purpose of this Act. If the ordinary police can also perform the police duties for the purposes of the Act, there can be no special reason for making the provision for the appointment of a special police officer. The expression 'police duties ' will include all the functions of the police in connection with the purpose of the Act and in the special context of the Act they will include the detection, pre vention and investigation of offences and the other duties which have been specially imposed on them under the Act. According to section 13 of the Act, 'there shall be, for each area to be specified by the State Government, a special police officer appointed by or on behalf of that Government for dealing with offences under the Act in that area '. The expression 'dealing with offences ' is of wide import and will include any act which the police has to do in connection with the offences under the Act. In this connection, we have been referred to the provisions of section 5 of the Criminal Procedure Code, which reads: "All offences under the Indian Penal Code shall be investigated, inquired into, tried, and otherwise dealt with according to the provisions hereinafter contained. (2) All offences under any other law shall be investigated, inquired into, tried, and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offences. " It is submitted that the expression 'dealt with ' must 703 mean something which is not included in investigation, inquiry or trial. This does not necessarily follow from the provisions of this section. The word ,otherwise ' points to the fact that the expression 'dealt with ' is all comprehensive, and that investigation, inquiry and trial were some aspects of 'dealing with ' the offences. Further, according to sub section (3) of section 13, the special police officer is to be assisted, for the efficient discharge of his functions in relation to offences under this Act, by a number of subordinate police officers and will be advised by a non official advisory body. The expression 'functions in relation to offences ' do include his functions connected with the investigation of the offences. There is no reason to exclude such functions from the functions contemplated by sub section The suggestion that the special police officer would be very heavily worked in case he had to perform all the ordinary duties of the police connected with the investigation of offences in addition to the duties conferred on him under the Act, does not go far in putting a different interpretation on the powers of the special police officer. He is to be assisted by his sub. ordinate police officers. They can investigate both under the implication of the provisions of section 13, as they are to assist the special police officer, and also on deputations by the special police officer, in view of section 157 of the Code. Section 5A of the Prevention of Corruption Act, 1947 (Act 11 of 1947) provides that notwithstanding anything contained in the Code of Criminal Procedure, no police officer below the rank of officers mentioned in clauses (a), (b) and (c) shall investigate any of the offences mentioned in that Section. The provision was made in a prohibitive form because the police officers below the ranks mentioned were not to exercise their power of investigation unless a Magistrate specially ordered them to investigate. The provision was not with respect to conferring any special powers on any particular officer. It was just to restrict the powers of certain officers with respect to investigating certain offences in certain circumstances. 704 The difference in the language of section 5A of the Prevention of Corruption Act from that of section 13 of the Act, is therefore of no help to the contention for the State. If the power of the special police officer to deal with the offences under the Act, and therefore to investigate into the offences, be not held exclusive, there can be then two investigations carried on by two different agencies, one by the special police officer and the other by the ordinary police. It is easy to imagine the difficulties which such duplication of proceedings can lead to. There is nothing in the Act to co ordinate the activities of the regular police with respect to cognizable offences under the Act and those of the special police officer. The special police officer is a police officer and is always of the rank higher than a Sub Inspector and therefore, in view of section 551 of the Code, can exercise the same powers throughout the local area to which he is appointed as may be exercised by the officer in charge of a police station within the limits of his station. We are therefore of opinion that the special police officer is competent to investigate and that he and his assistant police officers are the only persons competent to investigate offences under the Act and that police officers not specially appointed as special police officers cannot investigate the offences under the Act even though they are cognizable offences. The result is that this appeal by the Delhi Administration fails and is hereby dismissed. MUDHOLKAR, J. The point which arises for consideration in this appeal is whether a charge sheet presented by a station house officer alleging against the respondent certain offences under the Suppression of Immoral Traffic in Women and Girls Act, 1956 (Act No. CIV of 1956) (hereinafter called the Act) is bad because the investigation into those offences was carried out not by a special police officer appointed under the Act but by the station house officer. The respondent is alleged to be a pimp and said to 705 have committed offences under section 8 of the Act. Inves tigation into the offences was made by the officer incharge of the Kamla Market Police Station and a charge sheet was presented by him before a First Class Magistrate in Delhi. Similar charge sheets were put up against certain other persons. An objection was taken before the Magistrate in all these cases that the charge sheets were bad because the investigation into the various offences was not made by the special police officer referred to in the Act. This objection was upheld by the Magistrate and the charge sheets were rejected. An application for revision was preferred by the Delhi Administration before the High Court of Punjab. But that application was also rejected. Thereupon the Administration sought a certificate from the High Court under article 134(1)(c) of the Constitution which the High Court granted. That is how the present appeal came to be preferred before this Court. The High Court, following the decision in Kuppammal, In re (1) held that an offence under the Act must be investigated only by one of the officers mentioned in section 13 and that a charge sheet based upon the investigation made by any other police officer is bad and must be quashed. In my opinion the view taken by the Madras High Court and accepted by the Punjab High Court is untenable. The Act creates certain new offences, prescribes the placing of certain restrictions upon persons found guilty of those offences, provides for the appointment of a special police officer and for the constitution of an Advisory Board, confers certain special powers upon the special police officer, em. powers Magistrates to order the closure of brothels and eviction of the offenders from the premises occupied by them as well as for the removal of prostitutes from any place and also makes a provision for the establishment of protective homes as well as em. powers Magistrates to order detention of women and girls in such protective homes in certain circumstances. In addition it provides for the making of rules. (1) I.L.R. 706 According to my brother Raghubar Dayal, J., since the Act creates new offences and prescribes the procedure for dealing with them it is a complete code in itself Therefore, according to him, to that extent the provisions of the Act must prevail over those of the Code of Criminal Procedure, 1898. Further according to him, since the Act provides for the appointment of a special police officer for dealing with offences under this Act in the area within his jurisdiction, it is he and he alone who can investigate into an offence under the Act committed within that area. It would be convenient to refer to the provisions of section 5 of the Code of Criminal Procedure which runs thus: "(1) All offences under the Indian Penal Code shall be investigated, inquired into, tried, and otherwise dealt with according to the provisions hereinafter contained. (2) All offences under any other law shall be investigated, inquired into, tried, and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offen ces. " Sub section (2) would prima facie apply to cases arising under the Suppression of Immoral Traffic in Women and Girls Act except to the extent that its provisions are abrogated or superseded by the aforesaid Act. While sub section (1) provides that only an offence under the Penal Code must be investigated in accordance with the provisions of the Code of Criminal Procedure, sub section (2) provides that offences under any other law shall be investigated, inquired into, tried and otherwise dealt with according to the provisions of the Code subject to any enactment for the time being in force "regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offences. " What has to be ascertained, therefore, is whether in the Act in question there are any provisions which regulate the manner of carrying out an investigation of offences thereunder because 707 here we are concerned only with the limited question of the power of a station house officer to investigate into an offence under the Act. A bare perusal of the Act would show that there is no provision therein which confers upon the special police officer appointed thereunder the power to investigate into an offence made punishable by the Act. Such power is, however, sought to be deduced from the provisions of sub section (1) of section 13 which reads thus: "There shall be for each area to be specified by the State Government in this behalf a special police officer appointed by or on behalf of that Government for dealing with offences under this Act in that area. " It is said that the words underlined are wide enough to include the power to investigate into offences. These are general words and are undoubtedly of wide import. But they must be construed in the light of the other provisions of the Act. The Act confers certain specific powers and imposes certain specified duties on a special police officer. It is to these matters that the words "dealing with offences" must be confined. If it were the intention of the legislature to confer upon a special police officer the sole power to investigate into an offence under the Act it would have enacted a provision similar to section 5A in the Prevention of Corruption Act, 1947 (2 of 1947). This Act was before the Parliament when it enacted the Act in question and it would be reasonable to presume that if Parliament intended to confer similar power upon a special police officer appointed under this Act it would have used the same language for expressing its will as it did in section 5A of the Prevention of Corruption Act. Offences under the Act have been made cognizable by section 14 thereof. Therefore, prima facie section 156(1) of the Code of Criminal Procedure would apply and an officer in charge of a police station would have the power to investigate into such an offence. No doubt, by virtue of the provisions of sub section (2) of section 5 of the Code of Criminal Procedure, the provisions of section 156, Criminal Procedure Code would be subject to those provisions of the Act which bear on the question of 708 investigation into offences. Had Parliament desired that the provisions of section 156 of the Code of Criminal Procedure should not apply to offences under the Act it would, in view of the provisions of sub section (2) of section 5 of the Code of Criminal Procedure, have been careful enough to make express provisions in the Act regulating the manner of investigation of offences thereunder and specifying the officer entitled to make the investigation so as to exclude a police officer entitled under the Code of Criminal Procedure to investigate into offences. In my judgment it would not have left the matter to mere conjecture and rested content by using the expression "dealing with offences under this Act", which on its face is inadequate for excluding the operation of section 166, Code of Criminal Procedure. Investigation, inquiry and trial of offences are definite stages in the process of bringing a delinquent to book. Each stage is distinct from the other and the legislature has made it quite clear in section 5 of the Code of Criminal Procedure itself that they are important enough to be mentioned specifically. To make the point clearer it would be useful to compare the provisions of sub section (1) of section 13 of the Act with those of sub sections (1) and (2) of section 5 of the Code of Criminal Procedure. While in the former, Parliament has merely used the words "dealing with offences under the Act" in the latter the words used are "investigating, in quiring into, trying or otherwise dealing with such offences." No doubt the expression "dealing with offences" would, according to its ordinary connotation, include the stages of investigation, inquiry and trial. But the legislature has specifically referred to the aforesaid three stages because of their importance and apparently for obviating any doubt as to its intention. When Parliament had before it the Code of Criminal Procedure and in particular the provisions of section 5 and section 156 thereof it would have used in sub section (1) of section 13 of the Act language similar to that used by it in sub& (2) of section 5, Criminal Procedure Code if it were its intention to include in sub section (1) of section 13 matters like investigation, inquiry and trial or any of 709 them. It would, therefore, be legitimate to infer that when Parliament spoke in section 13(1) of a special police officer being empowered to deal with offences under the Act it did not intend to confer upon him the power to investigate into an offence under the Act. It was pointed out to us that a special police officer shall not be below the rank of an Assistant Commissioner of Police in the towns of Madras and Calcutta and a Superintendent of Police in. the Presidency Town of Bombay and a Deputy Superintendent of Police elsewhere and, therefore, such police officer would have the power to investigate into an offence. That, however, would be not by force of the provisions of sub section (1) of section 13 of the Act but by that of the provisions of section 551 of the Code of Criminal Procedure, which runs thus: "Police officers superior in rank to an officer incharge of a police station may exercise the same powers, throughout the local area to which they are appointed, as may be exercised by such officer within the limits of his station. " I would like to make it clear that it is not my view that a special police officer appointed under the Act cannot have the power to investigate into an offence under the Act but what I hold is that he does not derive such power from sub section (1) of section 13 of the Act. It is only under section 551 of the Code of Criminal Procedure that he may be able to exercise the power to investigate into an offence under the Act. It was said by reference to the definition of special police officer in section 2(1) of the Act that since such an officer is to be in charge of "police duties" within a specified area he would have the power to investigate into an offence. The expression "police duties" is not defined anywhere in the Act. But we were referred to section 23 of the Police Act in this connection. The relevant part of that section runs thus: "It shall be the duty of every police officer promptly to obey and execute all orders and warrants lawfully issued to him by any competent authority; to collect and communicate intelligence affecting the 90 710 public peace; to prevent the commission of offences and public nuisances; to detect and bring offenders to justice. . " The suggestion is that the words "to detect and bring offenders to justice" are comprehensive enough to include the power to investigate. It is sufficient to say that the duties enjoined upon police officers by section 23 are something quite apart from those which are enjoined upon them by the Code of Criminal Procedure. The investigation into an offence is a matter of some importance. Statements recorded therein have considerable value and can be used for contra. dieting witnesses questioned during investigation. It is for this reason that detailed provisions have been incorporated in the Code of Criminal Procedure dealing with this subject. It is only when an investigation is completed that a police officer is empowered to present a charge sheet. Neither the Police Act nor the Suppression of Immoral Traffic in Women and Girls Act contains any provision whatsoever with regard to the making of an investigation or presentation of a charge sheet. It would, therefore, not be appropriate to read in the words "deal with offences" the power to investigate into them and present a charge sheet. The High Court of Punjab as well as the High Court of Madras have held not only that section 13(1) of the Act confers power upon special police officer to investigate into an offence under the Act but that the power conferred is exclusive. I am unable to appreciate how even assuming that the words "deal with offences" confer upon a special police officer the power to investigate into an offence under the Act and present a charge sheet, the powers of an officer in charge of a station house within whose jurisdiction an offence under the Act has been committed are excluded. There is not a whisper in section 13(1) of the Act of the exclusion of the powers of an officer in charge of a police station. It is suggested that unless it is so held a confusion will result because the special police officer as well as the officer in charge of a police station will 711 each exercise his power to investigate into an offence under the Act. I do not think that there would be a danger of such simultaneous exercise of the power to investigate by two officers. The offence will have to be registered at the police station within the limits of the jurisdiction of which the offence has taken place. Thereafter it would be investigated into by the officer at whose instance it was registered. If that officer happens to be a station house officer the special police officer may take out the investigation from his hands or allow him to continue it. If the offence is registered at the instance of the special police officer, the station house officer would be bound to know of it from the station house records and would stay his hands. Upon this view, therefore, I would allow the appeal, set aside the judgment of the High Court and of the Magistrate and remit the case to the latter for being dealt with according to law. By COURT: In accordance with the opinion of the majority, this appeal is dismissed. Appeal dismissed.

The respondent was prosecuted for an offence under section 8 of the Suppression of Immoral Traffic in Women and Girls Act, 1956, and a charge sheet was presented before a First Class Magistrate in Delhi by a sub inspector, who, as the officer in charge of the Police Station, had investigated the case. On an objection raised by the respondent, the Magistrate quashed the charge sheet on the ground that only the special police officer appointed under the Act was competent to investigate the offences under the Act. Held, (Mudholkar, J., dissenting), that since the Suppression of Immoral Traffic in Women and Girls Act, 1956, created new offences and prescribed the procedure for dealing with them, it was a complete code in itself and to that extent the provisions of the Act must prevail over those of the Code of Criminal Procedure, 1898; that as the Act provided for the appointment of a special police officer for dealing with offences under the Act in the area within his jurisdiction, he and his assistant police officers were the only persons who could investigate offences under the Act committed within that area, and that police officers not specially appointed as special police officers could not 695 investigate the offences under the Act even though they were cognizable offences. per Mudholkar, J. A special police officer appointed under the Suppression of Immoral Traffic in Women and Girls Act, 1956, and empowered to deal with offences under the Act under section 13(1) derives the power to investigate into such offences not from that section but only under section 551. of the Code of Criminal Procedure. Even assuming that the words "deal with offences". in section 13(1) confer upon a special police officer the power to investigate into an offence under the Act and present a charge sheet, the powers of an officer in charge of a station house within whose jurisdiction an offence under the Act has been committed are not excluded by any of the provisions of the Act.

129 of 1959. Petition under article 32 of the Constitution of India for the enforcement of fundamental rights. R. Ganapathy Iyer, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the petitioners. N. section Bindra and R. H. Dhebar, for the respondents. section T. Desai, Trikamlal Patel and I. N. Shroff, for the Interveners. May 2. The Judgment of the Court was delivered by WANCHOO, J. This petition raises a question as to the constitutionality of the Bombay Agricultural Produce Markets Act, No. XXII of 1939 (hereinafter referred to as the Act) and the Rules framed thereunder. The petitioners are businessmen of Ahmedabad. Their case is that by a notification under the 661 Act the whole area within a radius of 12 miles of Ahmedabad city was declared to be a market area under section 4 of the Act for the purposes of the Act in respect of certain agricultural produce from June 1, 1948. At the same time a market yard and a market proper were established for dealing in the commodities mentioned above; and simultaneously a market committee was established under section 5 of the Act for the Ahmedabad market area by the name of "The Agricultural Produce Market Committee, Ahmedabad. " By later notifications certain other agricultural produce was declared to be regulated under the provisions of the Act in this market area. ID 1959 a locality known as the "Kalupur market" in the Telia Mill compound near the railway station Ahmedabad was declared to be a sub market yard for the purposes of the Act. The petitioners apparently were carrying on business in the Kalupur market and therefore after the declaration of that area as sub market yard, the market committee required the petitioners to take out licences under the Act without which they were not to be allowed to carry on business. The petitioners contend that the various provisions of the Act and the Rules and bye laws framed thereunder place un reasonable restrictions on their right to carry on trade in agricultural produce and thus infringe their fundamental right guaranteed under article 19 (1)(g) of the Constitution. In particular, the heavy fees payable to the market committee for taking out licences in order to trade in various markets impose a heavy burden on trade in the regulated commodities resulting in an unreasonable restriction on the right of the petitioners to carry on their trade. Further the declaration of the market area and the establishment of market yard and sub market yards has resulted in compelling producers of agricultural commodities to carry their produce for long distances, thus imposing an unreasonable restriction on their right to carry on trade. The petitioners thus assail the main provisions of the Act and some of the provisions of the Rules and the bye laws framed by the market committee, 84 662 which we shall specify at their proper place later. The petitioners also contend that the State of Bombay has never required the market committee to establish a market as required by section 5AA of the Act and no market has in law been established by the market committee and therefore the market committee has no power to issue licences and to exercise other powers conferred under the Act on market committees. They therefore pray that the Act and the Rules and the bye laws framed thereunder may be declared unconstitutional, ultra vires and void. In the alternative a direction should be issued to the respondents, in particular the market committee, not to enforce the provisions of the Act, the Rules and the bye laws against the petitioners so long as a market has not been established as required under the law. The petition has been opposed on behalf of the respondents, and their contention is that the Act, the Rules and the bye laws provide reasonable restrictions on the fundamental right to carry on trade under article 19(1)(g). It is further contended that a market has been established as required by law, and therefore the market committee in particular has the right to enforce all the provisions of the Act, the Rules and the bye laws and to insist upon the petitioners taking out licences as provided therein. Before we consider the attack made on the constitutionality of the Act, the Rules arid the bye laws framed thereunder, we should like to refer to the main provisions of the Act and the scheme of regulation provided in it. The Act deals with the regulation of purchase and sale of agricultural produce in the State of Bombay and establishment of markets for such produce. Section 2 of the Act is the definition section. Section 3 provides for the constitution of markets and market committees and gives power to the Commissioner by notification to declare his intention of regulating the purchase and sale of such agricultural produce and in such area as may be specified in the notification; and objections and suggestions are invited within a month of the publication of the notification. Thereafter the Commissioner after considering the objections and suggestions, if any, and 663 after holding such inquiry as may be necessary, declares the area under section 4(1) to be a market area for the, purposes of the Act. The consequence of the establishment of the market area is given in section 4(2) which lays down that after the market area is declared, no place in the said area shall, subject to the provisions of section 5A, be used for the, purchase or sale of any agricultural produce specified in the notification. After the declaration of the market area, the State Government is given the power under section 5 to establish a market committee for every market area. Thereafter under section 5AA it becomes the duty of the market committee to enforce the provisions of the Act, and also to establish a market therein, on being required to do so by the State Government, providing for such facilities as the State Government may from time to time direct, in connection with the purchase and sale of the agricultural produce with which the market committee is concerned. The Act however envisages that there may be a time lag between the declaration of a market area and the establishment of a market; therefore the proviso to section 4(2) lays down that pending the establishment of a market in a market area the Commissioner may grant a licence to any person to use any place in the said area for the purpose of purchase and sale of any such agricultural produce, and it is the duty of the market committee under section 5AA also to enforce the conditions of a licence granted under section 4(2). Further under section 5A, where a market has been established, the market committee is given the power to issue licences in accordance with the Rules to traders, commission agents, brokers, weighmen, measurers, surveyors, ware housemen and other persons to operate in the market; provided that no such licence shall be necessary in the case of a person to whom a licence has been granted under the proviso to section 4(2). The effect therefore of these provisions of the Act read with the definition section is this. A market area is first declared under section 4(1). In the market area, a market may be established. The Rules make it clear that the market may consist of what are called market proper and principal market yard and 664 sub market yards, if any. Under section 4A for each market area there shall be one principal market yard and one or more sub market yards as may be necessary and the Commissioner is given the power by notification to declare any enclosure, building or locality in any market area to be the principal market yard for that area and other enclosures, buildings or localities to be one or more sub market yards for the area. As we have already said, the Act envisages that there may be a time lag between the declaration of a market area and the establishment of a market, and that is why there is a provision for licences under the proviso to section 4(2) pending the establishment of a market in a market area. The establishment of a market, however, takes place only when the State Government requires the market committee under section 5AA to establish a market in the market area. There does not seem to be any provision in the Act or the Rules as to how the market committee shall proceed, on being required to do so by the State Government, to establish a market; but reading the provisions of section 4A and section 5AA together it appears that after the State Government has required the market committee to establish a market, it has to approach the Commissioner with its recommendation to declare localities as the principal market yard and the sub market yards, if any, and the Commissioner makes a notification in regard thereto, and thereafter the market is established. Till however such action is taken by the committee and the Commissioner notifies a principal market yard and sub market yards, if any, no market can in law be established; and other provisions of the Act which come into force after the establishment of a market cannot be enforced and the trade is till then regulated in the manner provided in the proviso to section 4(2). After the market is established, the market committee gets the power to issue licences under section 5A. Other provisions of the Act provide for the constitution of market committees and the establishment of a market committee fund and the ancillary powers of market committees with which however we are not directly concerned in the present case. It is 665 enough to refer to section 11 only in this connection, which provides that the market committee may subject to( the provisions of Rules and subject to such maxima as may be prescribed levy fees on the agricultural produce bought and sold by licencees in the market area. This section, it will be noticed, applies to the purchase and sale of agricultural produce in the market area and the power under it can be exercised by the committee as soon as the market area is declared, though no market might have been established under section 5AA. Till such time as the market is established the fees prescribed under section 11 would be levied on the licencees under the proviso to section 4(2). Then come sections creating offences for contravention of the various provisions of the Act, which it is unnecessary to consider. Section 26 gives power to the State Government to frame rules for the purposes of carrying out the provisions of the Act. Section 27 gives power to the market committee to frame bylaws with the previous sanction of the Director or any other officer specially empowered in this behalf by the State Government and subject to any rules framed by the State Government under section 26. Finally, section 29 provides that the State Government may by notification in the official gazette add to, amend or cancel any of the items of agricultural produce specified in the Schedule to the Act. These are the main provisions of the Act and the scheme which results in the declaration of a market area and the establishment of a market therein. The first contention on behalf of the petitioners is that sections 4, 4A, 5, 5A and 5AA which provide for the declaration of a market area and the establishment of a market are unconstitutional as they are unreasonable restrictions on the right to carry on trade in agricultural produce. We are of opinion that there is no force in this contention. This Court had occasion to consider a similar Act, namely, the Madras Commercial Crops Markets Act, No. XX of 1933, in M. C. V. section Arunachala Nadar etc. vs The State of Madras and others (1) and the regulation with respect to marketing (1) [1959] Supp 1 S.C.R. 92. 666 of commercial crops provided in that Act was upheld. The main provisions of the Madras Act with respect to the declaration of a market area (called notified area in that Act) and the establishment of markets are practically the same as under the Act. It is therefore idle for the petitioners to contend that the main provisions contained in sections 4, 4A, 5, 5A and 5AA of the Act are unconstitutional. Learned counsel for the petitioners, however, urges that there is a difference between the Madras Act and; the Act inasmuch as the Madras Act dealt with commercial crops whereas the Act makes it possible to bring every crop under its sweep. It is conceded that though it may be con stitutional to regulate the sale and purchase of commercial crops, regulation of all crops made possible under the Act would mean an unreasonable restriction on the fundamental right enshrined in article 19(1)(g). We are of opinion that there is no force in this contention. The Madras Act which dealt with commercial crops specified certain crops as commercial crops in the definition section and added that the words "commercial crop" used in that Act would include any other crop or product, notified by the State Government in the Fort St. George Gazette as a commercial crop for the purposes of that Act. In view of this inclusive definition of "commercial crop" in the Madras Act, it was open to the State Government under that Act to include any crop within the meaning of the words "commercial crop" which was regulated by that Act. The Act had a schedule when it originally passed in which certain crops were included. The State Government was however given the power to add to, or amend or cancel any of the items mentioned in the Schedule by section 29. It is true therefore that under the Act it is open to the State Government to bring any crop other than those specified originally in the Schedule within its regulatory provisions; but the fact that it is possible to bring any crop within the regulatory provisions of the Act by amendment of the Schedule would not necessarily make the Act an unreasonable restriction on the exercise of the fundamental right guaranteed under article 667 19(1)(g). As we have already pointed out, the definition of the words "commercial crop" in the Madras Act was also wide enough to bring any crop which the State Government considered fit to be included as a commercial crop for the purposes of that Act. There is thus in our opinion no difference in the ambit of the Madras Act and of the Act. Besides we see no reason why a crop which can be dealt with on a commercial scale should not be brought under the regulatory provisions of the Act. Section 4(2A) makes it clear that the Act does not apply to the purchase or sale of specified agricultural produce, if the producer of such produce is himself its seller and the purchaser is a person who purchases such produce for his own private use or if such agricultural produce is sold to such person by way of a retail sale. Thus it is clear from this exception that the provisions of the Act do not apply to retail sale and are confined to what may be called wholesale trade in the crops regulated thereunder. This would suggest that the Act also deals with commercial crops in the same way as the Madras Act, for the notion of wholesale trade implies that the crop dealt with therein is a commercial crop. There is thus no distinction so far as the main provisions are concerned between the Act and the Madras Act, and for the reasons that have been elaborately considered in Arunachala Nadar 's case (1) we are of opinion that sections 4, 4A, 5,5A and 5AA of the Act are constitutional and intra vires and do not impose un reasonable restrictions on the right to carry on trade in the agricultural produce regulated under the Act. The next attack is on section 29 of the Act, which provides that the State Government may by notification in the official gazette, add to, amend or cancel any of the items of agricultural produce specified in the Schedule. It is submitted that this gives a completely unregulated power to the State Government to include any crop within the Schedule without any guidance or control whatsoever. We are of opinion that this contention must also fail. It is true that section 29 itself does not provide for any criterion for determining which crop shall be put into the Schedule or which shall (1) [1959] Supp. 1 S.C.R. 92. 668 be taken out therefrom but the guidance is in our opinion writ large in the various provisions of the Act itself. As we have already pointed out, the scheme of the Act is to leave out of account retail sale altogether; it deals with what may be called wholesale trade and this in our opinion provides ample guidance to the State Government when it comes to decide whether a particular agricultural produce should be added to, or taken out of, the Schedule. The State Government will have to consider in each case whether the volume of trade in the produce is of such a nature as to give rise to wholesale trade. If it comes to this conclusion it may add that produce to the Schedule. On the other hand if it comes to the conclusion that the production of a particular produce included in the Schedule has fallen and can be no longer a subject matter of wholesale trade, it may take out that produce from the Schedule. We may in this connection refer to The Edward Mills Co. Ltd., Beawar vs The State of Ajmer and another (1). In that case, section 27 of the , which gave power to the appropriate Government to add to either part of the schedule any employment in respect of which it is of opinion that minimum wages shall be fixed by giving notification in a particular manner was held to be constitutional. It was observed in that case that the legislative policy was apparent on the face of the enactment (impugned there); it was to carry out effectively the purposes of the enactment that power had been given to the appropriate Government to decide with reference to local conditions whether it was desirable that minimum wages should be fixed in regard to a particular trade or industry which was not included in the list. The same considerations in our opinion apply to section 29 of the Act and the power is given to the State Government to add to, or amend, or cancel any of the items of the agricultural produce specified in the Schedule in accordance with the local conditions prevailing in different parts of the State in pursuance of the legislative policy which is apparent on the face of the Act. Therefore, in enacting section 29, (1) ; 669 the legislature had, not stripped itself of its essential powers or assigned to the administrative authority, anything but an accessory or subordinate power which was deemed necessary to carry out the purpose and policy of the Act. We therefore reject the contention that section 29 of the Act gives uncontrolled power to the State Government and is therefore unconstitutional. The next attack is on section 11 of the Act and the rules framed in that connection. Section II 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 licencees in the market area. It is said that the fee provided by section 11 is in the nature of sales tax. Now there is no doubt that the market committee which is authorised to levy this fee renders services to the licencees, 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. The attack on section 11 must therefore fail. Besides this however, it is also contended that rr. 53 and 54 which provide for levying of fees under section II are ultra vires, as they do not conform to section 11 of the Act. It will be noticed that section 11 provides for levy of fees to be fixed by the market committee, subject to such maxima as may be prescribed by the Rules and this fee is to be charged on the agricultural produce bought and sold. There are thus two restrictions on the power of the market committee under section 11; the first is that the fee fixed must be within the maxima prescribed by the Rules and naturally till such maxima are fixed it would not be possible for the market committee to levy fees, and the second restriction is that fees have to be charged not on the produce brought into but only on such produce as is 85 670 actually sold. Rule 53 provides that the market committee shall levy and collect fees on agricultural produce bought and sold in the market area at such rates as may be specified in the bye laws. The Rules nowhere prescribe the maxima within which the bylaws will prescribe fees. The first attack therefore on the Rules is that it will not be open to the market committee to prescribe any fee under section 11 till the State Government prescribes the maxima by the Rules, which it has not done so far. Further there is an attack on r. 54 which lays down that the fees on agricultural produce shall be payable as soon as it is brought into the principal market yard or sub market yard or market proper or market area as may be specified in the bye laws. The argument is that this rule allows fees to be charged on the produce brought into the market irrespective of whether it is actually bought and sold, and this is against section 11. As we read section 11, there is no doubt that the State Government is expected to specify the maxima within which the market committee shall fix fees and until such maximum is specified by the State Government in the Rules it would not be possible for the market committee to fix any fees under section 11. Further, there is no doubt that section 11 provides that fees shall be charged only on the amount of produce bought and sold and not on all the produce that may have been brought into the market but may have to be taken back as it is not sold. The reply of the respondents so far as r. 54 is concerned is that the rule only prescribes a convenient method of levying fees and that various bye laws provide for refund in case there is no sale of the produce brought into the market. The petitioners in their application have not specifically said that there is no provision for refund and in the circumstances all that we need say is that r. 54 will be valid if proper provision for refund is made in the bye laws with respect to the produce brought into the market on which fees have been charged but which has been taken back because it is not sold, for then it would only be a method of levying the fee permitted under section 11. In the connected petition Yograj 671 Shankersingh Parihar and another vs The State of Bombay and another (57 of 1957) which was heard along with this petition there was an attack on r. 53; but the attack was confined to the fee being analogous to a sales tax and there was no ground taken that the fee could not be levied under r. 53 because the maxima had not been specified in the Rules. However, it is not in dispute in this case that maximum has not been specified in any rule and r. 53 itself leaves it open to the market committee to prescribe such rates as may be specified in the bye laws. We have already said that it would not be possible for the market committee to prescribe any fees under section 11 through byelaws till the State Government prescribes the maximum under section 11. As no such maximum has been prescribed in the Rules, the contention that fees which are being charged under the bye laws for the purposes of section 11 are ultra vires of that section, must prevail. It has been urged on behalf of the respondents that the true construction of section 11 is that if maxima are prescribed by the Rules, fees will be fixed by the market committee within the maxima; but if no maxima are fixed under the Rules, it will still be open to the market committee to prescribe any fees it thinks proper under its power under section 11. We are not prepared to accept this interpretation of section 11, for it amounts to adding the words "if any" after the word "maxima" therein. Besides, the legislature was conferring power of taxation (using the word in its widest sense) by section 11 on the market committee. While doing so, the legislature apparently intended that the committee shall not have unlimited power to fix any fees it liked. It restricted that power within the maxima to be prescribed by the State Government in the Rules. Thus the power given to the committee was meant to be subject to the control of the State Government which would be in a position to view the situation as a whole and decide the maxima. At the same time, some flexibility was provided by leaving it to the committee to fix fees within the maxima. We may in this connection refer to various municipal Acts for example where also the power of taxation is subject to the control of the 672 different form. Section 11 also prescribes similar control by the State Government over this taxing power of the committee and this is obviously in the interest of the community as a whole. The State Government cannot practically abdicate that power as it seems to have done under r. 53 by leaving it to the committee to fix any rates it likes. We are therefore of opinion that unless the State Government fixes the maxima by rule it is not open to the committee to fix any fees at all and the construction urged on behalf of the respondents is not correct. The next attack is on r. 64 which provides that no person shall (a) enter a principal market yard or sub market yard in contravention of a direction given by a servant or a member of the market committee, or (b) disobey any of the directions of the market committee in regard to the places where carts laden with agricultural produce may stand or loads of agricultural produce may be exposed or in regard to the road by which or in regard to the times at which they may proceed. Any person contravening or disobeying any of the directions referred to in sub r. (1) shall, on conviction be punishable with fine. It is urged that this rule is ultra vires as it imposes an unreasonable restriction on the right to carry on trade. We are of opinion that there is no force in this contention because this rule is merely a method of enforcing the regulatory provisions with respect to market yards and sub market yards. The next attack is on r. 65 which provides that "no person shall do business as a trader or a general commission agent in agricultural produce in any market area except under a licence granted by the market committee under this rule. " The contention is that this rule goes beyond the provisions of section 5A which lays down that "where a market is established under section 5AA, the market committee may issue licences in accordance with the Rules to traders, commission agents. . So far as the grant of licence to traders before the establishment of a market is concerned, the provision is to be found in the proviso to 673 s.4(2) and the power to grant licences before the establishment of a market for trading in any market, area, is given to the Commissioner and not to the market committee. The power of the market committee to grant licences under section 5A arises only after a market is established and is confined to operation in the market. Rule 65 therefore in our opinion when it authorises the market committee to grant a licence for doing business in any market area goes beyond the power conferred on the market committee by section 5A and entrenches on the power of the Commissioner under the proviso to section 4(2). It must therefore be struck down as ultra vires of the provisions in section 5A read with the proviso to section 4(2). Rule 66 which is incidental would fall along with r. 65. The next attack is on r. 67. It gives power to the market committee to grant licences for doing business in the market area and prohibits doing of business without such licences. This rule is open to the same objection as r. 65, for the power of the market committee to grant licences is with respect to operation in the market and not in the market area, the latter power being in the Commissioner under the proviso to section 4(2) till the market is established. It seems to us that rr. 65 and 67 as they are framed show a confusion in the mind of the rule making authority. It would have been enough if the Rules had been confined to grant of licences for operation in the market, for under the law as soon as the market area is declared and a market is established, section 4(2) comes into force and no place in the said area can be used for the purchase and sale of any agricultural produce except as provided by section 5A. It seems to us therefore that the intention probably was to confine the issue of licences under rr. 65 and 67 to markets which the market committee has the power to do where a market is established under section 5A; but the two rule. , as drafted refer to the market area and not to the market and must therefore be held to be beyond the power granted to the market committee under section 5A. The last point that is urged is that no market has been established in law as required under section 5AA of the 674 Act. We have already said while dealing with the scheme of the Act that the scheme envisages that there may be a time lag between the declaration of a market area under section 4 and the establishment of a market. under section 5AA. We have also pointed out that a market can only be established by a market committee constituted under section 5, if it is required so to do by the State Government under section 5AA. Therefore, the requirement by the State Government is a condition precedent to the establishment of a market under section 5AA. No procedure has however been prescribed either under the Act or under the Rules as to what the market committee has to do after it has been required to establish a market. We presume, in view of the provisions of section 4A which gives power to the Commissioner to establish a market yard or sub market yards, that the market committee after it receives a direction from the State Government to establish a market will have to approach the Commissioner with its recommendation and ask him to notify the establishment of a principal market yard and sub market yards, if any. The contention of the petitioners is that no direction was issued by the State Government under section 5AA to the market committee for the establishment of a market and that in any case the committee took no steps after the receipt of any such direction for the establishment of a principal market yard and sub market yards, if any. It appears that the market area was declared for the first time in Ahmedabad from June 1, 1948, by notification dated April 15, 1948. This was followed by another notification by which the State Government established a market and a market proper under the Act as it stood before the amendment of 1954 by which the power to establish a principal market yard and sub market yards has now been given to the Commissioner. It seems however that no direction was issued as required by section 5 of the Act as it stood before the amendment (now section 5AA) requiring the market committee to establish a market. This matter had come to the notice of the Bombay High Court in Bapubhai 675 Ratanchand Shah vs The State of Bombay (1). Chagla, C. J., then pointed out as follows at p. 887: "Now, a very curious situation was disclosed to us by Mr. Joshi. No market has been established under section 5 of the Act and therefore section 5A has not come into operation. The result is this that the Market Committee cannot issue licences under section 5A to traders, commission agents, etc., to operate in the market. In the absence of a market being established under section 5 and the absence of licences being issued under section 5A, licences can only be issued by the State Government under the proviso to section 4A(2). But the rules show that licences have been issued by the Market Committee and not by the State Govern ment. It is difficult to understand how either the Government or the Market Committee came to the conclusion that the Market Committee was authorised to issue licences without section 5 and section 5A being brought into force. Mr. Joshi suggests that the Market Committee acts as a delegate of the State Government and the authority to issue licences has been delegated by the State Government. It is rather difficult to accept this contention. " Having said this, the learned Chief Justice went on to observe that as there was no such challenge in the petition itself, therefore whether the challenge could be sustained or not, it was not open to the petitioners before him to make that challenge. That observation was made with respect to another market area but the same, we understand, applies to the present case. It appears that after that observation of the Bombay High Court, the State Government on August 11, 1955, issued a notification (No. PMA 7055) dated August 1, 1955, directing the Agricultural Produce Market Committee Ahmedabad to establish a market in the market area for which the said committee had been established. But there is nothing in the affidavit of the respondents to show that after this direction was issued on August 11, 1955, the market committee took any steps to establish a market by making recommendations to the Commissioner to establish a principal (1) I.L.R. 676 market yard or sub market yards under section 4A of the Act. As a matter of fact, the principal market yard was already there from before this direction given in 1955 and has continued. Even in the case of the sub market yard established at Kalupur in 1959 there is nothing in the notification issued by the Commissioner on January 16, 1959, to show that he was doing so in pursuance of the desire of the market committee and on its recommendation. We should have thought that if the market committee had requested the Commissioner to establish a sub market yard and recommended Kalupur as the place for it, the notification should have shown that the Commissioner was acting at the desire of the market committee and on its recommendation. In any case, even if the notification did not show this, it was the duty of the respondents, when this question was specifically raised in para. 25 of the petition, to state when the State Government directed the market committee to establish the market and what steps the market committee took in that behalf after such direction. But in para. 24 of the counter affidavit filed on behalf of the respondents all that is stated is that "with reference to paragraph 25 of the petition, I crave leave to refer to section 5 A of the Act for ascertaining its contents, true meaning and legal effect. I deny all the allegations, contentions and submissions contained in paragraph 25 of the petition as are contrary to or inconsistent with what is stated herein as if they were specifically set out herein and traversed. " We must say that this is a most curious way of meeting the allegations made on behalf of the petitioners that no direction as required by section 5AA of the Act has been ever given to the market committee to establish a market and no steps were ever taken by the market committee in pursuance of such a direction to establish a market. The notification No. PMA 7055 which was produced before us during the course of arguments seems in the circumstances to have been an empty formality which was observed in view of the observations of the Bombay High Court in Bapubhai Ratanchand Shah 's case (1). It seems to us that the curious situation which (1) I.L.R. 677 the Bombay High Court noticed as far back as March, 1955 still continues with respect to the market in this( case and no proper steps have been taken in law even after the formal direction made by notification No. PMA 7055 in August, 1955 to establish a market. It is true that in fact the State Government before the amendment of 1954 and the Commissioner after that amendment have established a principal market and a sub market yard for this market area; but there is nothing to show in the case of the principal market yard that it was established at the instance of the market committee on a direction given by the State Government as required by section 5 of the Act as it was before the amendment of 1954 or that the sub market yard at Kalupur which was established in 1959 was so established at the instance of the market committee. In the circumstances the curious situation that was noticed with respect to another market area by Chagla, C. J., is there with respect to the Ahmedabad market area and the Ahmedabad market, with the result that the market committee cannot issue licences under section 5A of the Act and exercise such other powers as may be exercisable on the establishment of a market under the law. In the result therefore the petition must be allowed and the market committee forbidden to enforce any of the provisions of the Act, the rules and the bye laws with respect to the market until a market is properly established under section 5AA. No other point has been urged before us. In conclusion we hold that the challenge made by the petitioners to the constitutionality of the main provisions of the Act and of the provisions in r. 64 fails; but the challenge in respect of (i) the provisions in r. 53 on the ground that they are ultra vires section 11, there being no maximum fee prescribed by the State Government, and (ii) the provisions in rr. 65, 66 and 67 on the ground that they are ultra vires the provisions in section 5(a) read with the proviso in section 4(2) succeeds. As however we have held that the market in this case has not been properly established, the market 86 678 committee cannot enforce any of the provisions of the Act or the rules or the bye laws framed by it and cannot issue licences till the market is properly established in law. We therefore allow the petition partly and direct the respondents not to enforce any of the provisions of the Act, the rules and the bye laws against the petitioners with respect to the market till a market is properly established in law for this area under section 5AA and not to levy any fees under section 11 till the maximum is prescribed under the Rules. In the circumstances we order parties to bear their own costs. Petition allowed in part.

The Bombay Agricultural Produce Markets Act, 1939, was enacted by the Bombay Legislature to provide for the better regulation of buying and selling of agricultural produce in the State of Bombay and the establishment of markets for such produce. Under the provisions of the Act power was given to the commissioner by notification to declare certain areas as market areas as a result of which such areas could not thereafter be used for the purchase or sale of any agricultural produce specified in the notification, except under a licence. Markets were to be established and market committees constituted with power to grant licences for operation in the market. By section 11 a market committee may, subject to the provisions of the Rules and subject to such maxima as may be prescribed, levy fees on the agricultural produce bought and sold by licencees in the market area. Section 29 enabled the State Government by notification in tile official Gazette to add to, amend or cancel any of the items of agricultural produce specified in the Schedule to the Act. The petitioners challenged the validity of the Act and the rules framed thereunder, and in particular sections 4, 4A, 5, 5A, and 5AA which provided for the declaration of a market area and the establishment of a market, as unconstitutional on the ground that they placed unreasonable restrictions on their right to carry oil trade in agricultural produce and thus infringed their fundamental right guaranteed under article 19(1)(g) of the Constitution of India. They also attacked the validity of sections 11 and 29 and rr. 53, 64, 65, 66 and 67. Held: (1) that sections 4, 4A, 5, 5A and 5AA of the Act are constitutional and intra vires and do not impose unreasonable restrictions on the right to carry on trade in the agricultural produce regulated under the Act. M. C. V. section Arunachala Nadar vs The State of Madras, [1959] Supp. 1 S.C.R. 92, followed. 660 (2) that the fee provided by section 11 though calculated on the amount of produce bought and sold, is not in the nature of sales tax as it is only a levy charged for services rendered by the market committee in connection with the enforcement of the various provisions of the Act. Accordingly, section 11 is valid. (3) that r. 53 in so far as it enables the market committee to fix any rates as it liked of the fees to be collected on agricultural produce bought and sold in the market area, is not valid, because under section 11 unless the State Government fixes the maxima by rule it is not open to the committee to fix any fees at all. (4) that under section 29, the power given to the State Govern ment to add to, or amend, or cancel any of the items of the agricultural produce specified in the Schedule in accordance with the local conditions prevailing in different parts of the State is only in pursuance of the legislative policy which is apparent on the face of the Act, and, therefore, the section is intra vires. The Edwards Mills Co. Ltd., Beaway vs State of Ajmer and Another, ; , applied. (5) that r. 64 is merely a method of enforcing the regu latory provisions with respect to market yards and sub market yards and is valid. (6) that rr. 65, 66 and 67, in so far as they authorise the market committee to grant a licence for doing business in any market area, go beyond the power conferred on the market committee by section 5A, and are ultra vires.

Appeal No. 425 of 1957. Appeal from the judgment and order dated February 21, 1956, of the Patna High Court in Misc. Judicial Case No. 53 of 1955. B. K. P. Sinha and D. P. Singh, for the appellants. L. K. Jha and R. C. Prasad, for the respondent. May 3. The Judgment of the Court was delivered by 688 SUBBA RAO, J. This appeal by certificate raises the question of the construction of section 4(h) of the Bihar Land Reforms Act, 1950 (Act 30 of 1950) (hereinafter referred to as the Act), as amended by the Bihar Land Reforms (Amendment) Act, 1959 (Bihar Act 16 of 1959) (hereinafter called the Amending Act). The facts giving rise to the appeal lie in a small compass. Plots NOW. 383 and 1033 are tanks in village Lakshmipur alias Tarauni in the District of Darbhanga. The respondent claims to have taken settlement of the said plots in the year 1943 from the landlords of Raghopur Estate of which the said plots formed a part. After the coming into force of the Act, the said Estate vested in the State of Bihar. Thereafter, one Sheonandan Jha and some other villagers of Lakshmipur filed a petition before the Collector alleging that the alleged settlement was not true, and that in fact the settlement was nominally effected only after January 1, 1946. The Additional Collector, Darbhanga, in exercise of the powers conferred on him under section 4(h) of the Act, held that the said settlement was actually made after January 1, 1946, and that it was only a paper transaction; having annulled the said settlement, the Additional Collector, by his order dated January 18, 1955, called upon the respondent to give up possession of the said plots by January 30, 1955. Aggrieved by the said order, the respondent filed a petition in the High Court of Judicature at Patna under article 226 of the Constitution for a rule in the nature of a writ of mandamus or any other appropriate writ cancelling the order of the Additional Collector dated January 18, 1955, and res training the appellants from interfering with his possession of the said two plots. That petition came to be decided by a division bench of the High Court; and the learned Judges by their order dated February 21, 1956, held that the Additional Collector had no jurisdiction to entertain and decide the question whether the settlement, which was prima facie shown to have been made before January 1, 1946, was actually made after that date. On the basis of that finding, the order of the Additional Collector was set aside. 689 The State of Bihar and the Additional Collector of Darbhanga have preferred the present appeal against the said order. Learned counsel for the State contends that section 4(h) of the Act has been amended with retrospective effect, that under the amended section the Collector has power to decide whether a transfer is made before 1946 or thereafter, and that, therefore, the order of the High Court can no longer be sustained. Learned counsel for the respondent, while conceding the retroactivity of the amendment, relies upon the second proviso added by the amendment to section 4(h) and contends that under the said proviso the order of the Collector cannot take effect nor possession taken thereunder, unless the said order has been confirmed by the State Government and that in the instant case there has not been any such confirmation. Further he questions the constitutional validity of the said section on the ground that it infringes the fundamental right of the respondent under articles 14, 19 and 31 of the Constitution and is not saved by article 31A thereof. The second contention of learned counsel for the respondent may be disposed of first. Under article 31A of the Constitution, no law providing for the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31. The question is whether section 4(h) of the Act is such a law as to be hit by article 31A of the Constitution. Section 4(h) of the Act confers power on a Collector, inter alia, to make inquiries in respect of any transfer of any land comprised in an estate and to cancel the same if he is satisfied that such transfer was made any time after January 1, 1946, with the object of defeating any provisions of the Act or causing loss to the State or obtaining compensation thereunder. It is said that the section ex proprio vigore does not provide for acquisition by the State of any estate or of 690 any rights therein or for the extinguishment or modification of any such rights and therefore, is not protected by article 31A of the Constitution This argument in effect disannexes section 4(h) of the Act from the setting in which it appears and seeks to test its validity independently of its interaction on the other provisions of the Act. Section 4(h) is an integral part of the Act, and taken out of the Act it can only operate in vacuum. Indeed, the object of the section is to offset the anticipatory attempts made by landlords to defeat the provisions of the Act. Suppose the Collector cancels a transfer of land by the owner of an estate under the said section; the said land automatically vests in the State, with the result that the rights of the transferor and the transferee therein are extinguished. The said result accrues on the basis that the said land continued to be a part of the estate at the time the Act came into force. That apart, the section is a part of the Act designed to extinguish or modify the rights in an estate, and the power conferred on a Collector to cancel a transfer of any land in an estate is only to prevent fraud and to achieve effectively the object of the Act. This question was directly raised and answered by this Court in Thakur Raghubir Singh vs State of Ajmer (1). There, the constitutional validity of the Ajmer Abolition of Intermediaries and Land Reforms Act, 1955 (Ajmer III of 1955) and section 8 thereof was attacked. Section 8 of the said Act conferred a power on the Collector to cancel a lease or contract, if he was satisfied that it was not made or entered into in the normal course of management, but in anticipation of legislation for the abolition of intermediaries. Repelling the said contention, Wanchoo, J., speaking for the Court, observed thus: "The provision is not an independent provision; it is merely ancillary in character enacted for carrying out the objects of the Act more effectively. Such cancellation would sub serve the purposes of the Act, and the provision for it therefore be an integral part of the Act, though ancillary to its main object, and would thus be protected under article 31A(1)(a) of the Constitution." (1) [1959] SUPP. 1 S.C.R. 478. 691 The same reasoning applies to section 4(h) of the Act, and for the same reasons we hold that section 4(h) of the Act is likewise protected by article 31A of the Constitution. The first question turns upon the interpretation of the relevant provisions of the Amending Act. To appreciate the argument it would be convenient to read the material provisions of the said Act. Section 3. Amendment of section 4 of Bihar Act XXX of 1950. In section 4 of the said Act, (iv) in clause (h) (a) the words, figures and commas "made at any time after the first day of January, 1946," shall be omitted and shall be deemed always to have been omitted; (b) after the words "if he is satisfied that such transfer was made," the words, figures and commas "at any time after the first day of January, 1946," shall be inserted and shall be deemed always to have been inserted; and (c) the words "and with the previous sanction of the State Government" shall be omitted; (v) to clause (h) as amended above, the following provisos shall be added, namely: "Provided that an appeal against an order of the Collector under this clause, if preferred within sixty days of such order, shall lie to the proscribed authority not below the rank of the Collector of a district who shall dispose of the same according to the prescribed procedure: Provided further that no order annulling a transfer shall take effect nor &hall possession be taken in perursuance of it unless such an order has been confirmed by the State Government." After the said amendment the relevant part of the section reads: The Collector shall have power to make inquiries in respect of any transfer including the settlement. . if he is satisfied that such transfer was made at any time after th e first day of January, 1946, with the object of defeating any provisions of this Act or causing loss to tile State or obtaining higher 692 compensation thereunder, the Collector may, after giving reasonable notice to the parties concerned to appear and be heard and with the previous sanction of the State Government annul such transfer, dispossess the person claiming under it and take possession of such property on such terms as may appear to the Collector to be fair and equitable. The main differences material to the present enquiry between the section as it was before. the amendment and thereafter are that under the unmended section it was a moot point whether the Collector had the power to set aside a transfer, whether it was effected before or after January 1, 1946; whereas under the amended section such a power is clearly and expressly conferred on him: while under the original section, the Collector had to take the previous sanction of the State Government before he made the order annulling a transfer and dispossessing the person claiming under it, under the amended section the order made by the Collector shall neither take effect nor can he take possession before his order is confirmed. The short question is whether the second proviso, added by the Amending Act, is retrospective in operation, that is, whether the order of the Collector made before the Amending Act, though made with the previous sanction of the State Government, would still require for its taking effect a subsequent confirmation by the State Government. Learned Counsel for the State contends that the amendments made by section 3(iv)(a) and (b) are retrospective, but the amendment made by section 3(v) of the Amending Act is prospective. This contention appears to be sound, both in letter as well as in spirit. The different phraseology used in cls. (a) and (b) of subs. (iv) of section 3 of the Amending Act in the matter of omissions supports it. While in cl. (a) the omission ,%hall be deemed always to have been omitted, in cl. (c) the words mentioned therein shall only be omitted indicating by contrast that the omission in the former is expressly made retrospective while in the latter it is necessarily prospective. , If that be the true con struction, the condition of previous sanctions would 693 continue to operate in respect of the Collector 's order made before the amendment came into force. If the proviso be given a retrospective operation, it directly comes into conflict with the result brought about by cl. (c) of sub section (iv) of section 3 of the Amending Act. An order with the previous sanction of the Government may have been passed and possession also taken by the Collector, yet a further confirmation by the Government should be sought for to revalidate it. This construction would not only attribute to the Legislature redundancy but would also enable a party to seek for restoration of the land taken possession of by the Collector on the basis of a technicality. Even in a case where possession has not been taken by the Collector, the said anomaly would persist, for two sanctions would be required. The alternative construction makes the working of the section smooth and avoids the introduction of the said incongruity and, therefore, we prefer to accept it, particularly when it is consistent with the plain meaning of the words used in the section. The result is that in respect of an order already made by the Collector before the Amending Act, the previous sanction obtained would suffice, and in respect of an order made after the Amending Act, a subsequent confirmation by the State Government is required. Even so, it is argued by learned counsel for the respondent that the High Court, presumably in view of its acceptance of the respondent 's preliminary point, did not consider the question whether the inquiry had been made by the Collector in strict compliance with the provisions of the section, and whether the previous sanction of the State Government was obtained before he made the said order. In the affidavit filed in support of the petition in the High Court there is no specific allegation that no such inquiry has been made or that no such sanction has been obtained. Nor did the counsel for the appellant raise the said question in the arguments before the High Court. In the circumstances we do not think that this Court is justified in allowing 88 694 the respondent to raise the said question for the first time before us. We, therefore, reject this plea. In the result we set aside the order of the High Court and allow the appeal. But, in the circumstances of this case, we direct the parties to bear their own costs here and in the High Court. Appeal allowed.

Section 4(h) of the Bihar Land Reforms Act, 1950, as amended by the Bihar Land Reforms (Amendment) Act, 1959, which empowers the Collector to annul anticipatory transfers of land designed to defeat the object of the Act, is protected by article 31A of the Constitution although it does not by itself provide for the acquisition by the State of any estate or of any rights therein or for the extinguishment or modification of any such rights and its constitutional validity cannot be questioned under articles 14, 19 and 31 of the Constitution since the Act of which it is an integral part, is itself directed to that end and is protected by that Article. Thakur Raghubir Singh vs State of Ajmer, [1959] Supp. 1 S.C.R. 478, applied. On a true construction of section 3 of the Amending Act, the second proviso to section 4(h) cannot be retrospective in operation and therefore, in respect of an order of annulment made by the Collector before the Amending Act came into force the previous sanction obtained from the State Government would be sufficient, but subsequent confirmation by the State Government would be necessary in the case of an order made after the Amending Act came into force.

Appeals Nos. 646 and 647 of 1960. Appeals by special leave from the judgments and orders dated January 28, 1958, of the Andhra Pradesh High Court in Writ Appeals Nos. 149 and 150 of 1957. 537 A. V. Viswanatha Sastri and T. Satyanarayana, for the appellants. A. Ranganatham Chetty, section V. P. Venkatappayya Sastri and T. M. Sen, for the respondent. April 28. The Judgment of the Court was A delivered by AYYANGAR, J. These two appeals are by special leave of this Court and arise out of orders of the High Court of Andhra Pradesh dismissing two writ petitions filed before it by the respective appellants in the two appeals. On January 14, 1953, the Government of Madras issued a notification reading, to quote only the material words, "in exercise of the powers conferred by section 1(4) of the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948 (Madras Act XXVI of 1948), read with section 2 of the Madras Scheduled Areas Estates (Abolition and Conversion into Ryotwari) Regulation, 1951: "The Governor of Madras hereby appoints the 4th of February 1953, as the date on which the provisions of the said Act shall come into force in the Estates in the Scheduled Areas of the West Godavari District which are specified in the schedule below: " and the schedule set out inter alia: "1. Agency Area of Gangole 'A ' Estate, consisting of 2 3. Agency Area of Gangole 'C ' Estate, consisting of. " It is the legality of this notification that is impugned by the two appellants who are the proprietors respectively of Gangole 'A ' and Gangole 'C ' estates. The two writ petitions by the appellants which were numbered respectively 28 and 29 of 1953 were dismissed by the learned Single Judge of the Andhra High Court and appeals under the Letters Patent filed against this common judgment were also dismissed by the learned Judges of that Court. An application for the grant of a certificate was also dismissed but this 538 Court having granted special leave to the appellants, the ' matter is now before us. The Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948, to which we shall refer as the Abolition Act, was a piece of legislation of the State enacted to effect reform in land tenures and landholding by the elimination of intermediaries. In line with similar legislation in the rest of the country, the interests of intermediaries of three categories the estates of Zamindars, of undertenure holders and of Inamdars were enabled to be vested in Government on the publication of a notification to that effect, compensation being provided for such taking over. The entire legal difficulties in the case of the Gangole 'A ' and IC ' estates which were admittedly Zamindaris arise out of the fact that a small portion of each of them is situated in what is known as the Godavari Agency tract. This Agency area was originally included as part of the Scheduled District of the Madras Presidency under the Scheduled Districts Act XIV of 1874. When the Godavari Agency was governed by the Scheduled Districts Act, 1874, the Madras Legislature enacted the Madras Estates Land Act (Act 1 of 1908), which was in force from July 1, 1908. This enactment regulated the rights of, inter alia, the proprietors of zamindari estates and the ryots and tenants who cultivated the lands included in the estates. Though, some argument was raised in the High Court, disputing the operation of the Estates Land Act to the Godavari Agency tracts, it has not been repeated before us. That Act on its terms applied to the entire Presidency of Madras and in view of a catena of decisions of the Madras High Court starting from the judgment of Muthuswami Iyer, J. in Chakrapani vs Varahalamma (1), on the construction of section 4 of the Scheduled Districts Act XIV of 1874, the contention was hardly tenable and was therefore properly abandoned. The position therefore was that the entirety of the lands and villages forming Gangole 'A ' and IC ' were governed by the Madras Estates Land Act, 1908, (1) Mad. 539 and were "estates" within the meaning of that enactment. In this situation the Government of India Act, 1935, came into force on April 1, 1937. Under its provisions the Godavari Agency was included in the territory classified as "partially excluded areas" under section 91 of the Act. The laws applicable to the "partially excluded areas" and their administration was governed by section 92 which enacted: "92(1) The executive authority of a Province extends to excluded and partially excluded areas therein, but, notwithstanding anything in this Act, no Act of the Federal Legislature or of the Provincial Legislature, shall apply to an excluded area or a partially excluded area, unless the Governor by public notification so directs; and the Governor in giving such direction with respect to any Act may direct that the Act shall in its application to the area, or to any specified part thereof, have effect subject to such exceptions or modifications as he thinks fit. (2) The Governor may make regulations for the peace and good government of any area in a Province which is for the time being an excluded area, or a partially excluded area, and any regulations so made may repeal or amend any Act of the Federal Legislature or of the Provincial Legislature, or any existing Indian law, which is for the time being applicable to the area in question. Regulations made under this sub section shall be submitted forthwith to the Governor General and until assented to by him in his discretion shall have no effect, and the provisions of this Part of this Act with respect to the power of His Majesty to disallow Acts shall apply in relation to any such regulations assented to by the Governor General as they apply in relation to Acts of a Provincial Legislature assented to by him. (3) The Governor shall, as respects any area in a Province which is for the time being an excluded area, exercise his functions in his discretion. " We shall be pointing out a little later, the interconnection between the Estates Land Act, 1908 and 540 the Abolition Act, but for the present narrative it is sufficient to state that when the Abolition Act was enacted in 1948, it could not of its own force, apply to the 'partially excluded areas ' and no action as contemplated by section 92 of the Government of India Act, 1935, was taken to render that Act applicable to that area. The result was that only a part of Gangole 'A ' and 'C ' were within the operation of the Abolition Act, while there were portions of each of the estates which were outside its purview and operation. This legal situation was however not noticed and under the wrong impression that the Abolition Act was in operation in the Godavari Agency also, the Government of Madras issued on August 15, 1950, a notification under section 1(4) of the Abolition Act by which, among other estates, the entirety of Gangole estate 'A ' and Gangole estate 'C ' were purported to be taken over, and specifying September 7, 1950, as the date on which the vesting was to take place. Before the latter date, however, the error was noticed and in consequence another notification was issued on the 5th of September by which the villages and hamlets lying in the "partially excluded areas" of Gangole estate 'A ' and Gangole estate IC ' were excluded from the scope of the notification dated August 15,1950. Thereafter the question of the extension of the Abolition Act to the "partially excluded areas" was taken on hand. By that date, it would be seen, the Consti tution had come into force and the law applicable to areas like the Godavari Agency was provided for by article 244 read with the Sch. V to the Constitution. article 244(1) enacted: "The provisions of the Fifth Schedule shall apply to the administration and control of the Scheduled Areas and Scheduled Tribes in any State other than the State of Assam. " As regards the law applicable to the Scheduled Areas, the relevant provision is that contained in paragraph 5 of that Schedule of which the material portions are: "5. Law applicable to Scheduled Areas (1) Notwithstanding anything in this Constitution, the Governor may by public notification 541 direct that any particular Act of Parliament or of the Legislature of the State shall riot apply to a Scheduled Area or any part thereof in the State or shall apply to a Scheduled Area or any part thereof in the State subject to such exceptions and modifications as he may specify in the notification and any direction given under this sub paragraph may be given so as to have retrospective effect. (2) The Governor may make regulations for the peace and good government of any area in a State which is for the time being a Scheduled Area. (3) In making any such regulation as is referred to in subparagraph (2) of this paragraph, the Governor may repeal or amend any Act of Parliament or of the Legislature of the State or any existing law which is for the time being applicable to the area in question. " In exercise of the power under paragraph 5(2) of the Fifth Schedule, Madras Regulation IV of 1951 was passed on September 8, 1951. The territorial extent of its operation extended to certain areas specified in the Schedule, which included the areas in the Godavari district in which the two Gangole estates were situate and by its operative provisions the Abolition Act together with the amendments effected to it, were made applicable to these areas with retrospective effect from April 19, 1949. The Abolition Act having thus been extended to that part of the Gangole 'A ' and Gangole 'C ' estates which lay within "the Scheduled area" the Government of Madras issued the impugned notification vesting those portions of the estate to which the Act was extended by Regulation IV of 1951. As stated earlier, it is the validity of this last notification and the vesting effected thereunder of those portions of Gangole 'A ' and Gangole 'C ' which lay within the Scheduled area that is alone challenged in the appeals before us. The notification was impugned on several grounds, all of which were rejected by the High Court. Several 69 542 of them have been put forward before us, though not all of them with equal emphasis. Before however adverting to them it might be convenient to set out the relevant statutory provisions which bear upon the points urged. The long title of the Abolition Act states: "Whereas it is expedient to provide for the repeal of the Permanent Settlement, the acquisition of the rights of landholders not permanently settled and certain other estates in the Province of Madras ". . It is hereby enacted as follows:" Section 1(3) defining the extent of its application runs: "It applies to all estates as defined in section 3, clause (2), of the Madras Estates Land Act, 1908, except inam villages which became estates by virtue of the Madras Estates Land (Third Amendment) Act, 1936. " Section 2 which is the definition section provides by sub section (1): "(1) All expressions defined in the Estates Land Act shall have the same respective meanings as in that Act with the modifications, if any, made by this Act." and sub section (3) provides: "(3) 'estate ' means a zamindari or an under tenure or an inam estate." and sub section (4) of this section defines 'Estates Land Act ' to mean "the Madras Estates Land Act, 1908. " Having regard to these provisions it is necessary to refer to the terms of the Estates Land Act to which one is directed by section 1(2) of the Abolition Act. Section 3 (2) of the Estates Land Act defines "an estate" as meaning: "3 (2)(a) any permanently settled estate or temporarily settled zamindari, (b) any portion of such permanently settled estate or temporarily settled zamindari which is separately registered in the office of the Collector; (c) (d) (e) 543 We shall now proceed to deal with the several points raised, though except one all the others do not merit any serious consideration and have been properly rejected by the High Court. The first point urged was that the Polavaram zamindari the parent estate from which the Gangole estate was, by successive sub divisions, separated was not "a permanently settled estate" because the ' Madras Permanent Settlement Regulation XXV of 1802 was excluded from its application to Scheduled districts by the Laws Local Extent Act, 1874. In our opinion, the High Court has rightly rejected this contention, because even if the Madras Permanent Settlement Regulation did not apply, there could be no dispute that the Polavaram zamindari was "a permanently settled estate", because its peishcush was fixed and from the kabuliyat which was executed by the proprietor it is clear that it conforms to the pattern of the sanads and kabuliyats issued under the Madras Permanent Settlement Regulation. Though before the High Court it was urged that on the issue of the notification on August 15, 1950, under section 1(4) of the Abolition Act the power of the State Government was exhausted and that they were thereafter incompetent to issue any further notification under the same Act, this contention which entirely lacks substance was not seriously urged. It was next contended that Regulation IV of 1951 was invalid as having outstepped the limits of the legislation permitted by paragraphs 5(1) and (2) of the Fifth Schedule to the Constitution. It was said that if the Governor desired to enact a law with retrospective effect it must be a law fashioned by himself, but that if he applied to the Scheduled areas a law already in force in the State, he could not do so with retrospective effect. Reduced to simple terms, the contention merely amounts to this that the Governor should have repeated in this Regulation the terms of the Abolition Act but that if he referred merely to the title of the Act he could not give retrospective effect to its provisions over the area to which it was being applied. It is obvious that this contention was correctly negatived by the High Court. 544 We shall now proceed to deal with the only point put forward by Mr. Viswanatha Sastri which, we have said, merits serious consideration, though it must be said that it was not presented in the same form before the learned Judges of the High Court of Andhra Pradesh. The, argument was as follows: The Madras Estates Land Act of 1908, admittedly applied to the entire estate of Gangole including that portion of the estate which was in the Scheduled area which, in the phraseology employed by the Government of India Act, was "a partially excluded area. " Gangole 'A ', Gangole 'B 'and Gangole 'C ' had been subdivided and had been separately registered. Each one of them was therefore a unit each one was itself "an estate" within section 3(2)(b) of the Estates Land Act, 1908, being "a portion of a permanently settled estate . . . . which is separately registered in the office of the Collector. " The Abolition Act contemplates the taking over of "estates" as a unit and not in parts. The entire scheme of the Abolition Act is based upon this principle which would be upset if it were held that the Government in issuing notifications under section 1(4) of the Abolition Act could take over portions merely of such units. When a notification is issued under section 1(4) its legal consequences are set out in section 3 which reads: "With effect on and from the notified date and save as otherwise expressly provided in this Act (the saving does not cover anything material for the present purpose) (a) (b) the entire estate (including all communal lands; porambokes; other non ryoti lands; ) shall stand transferred to the Government and vest in them, free of all encumbrances. ." The provisions of the Act determining the amount of compensation are related to the sum payable in respect of the entirety of the estate, for sections 24 and 25 enact: "24. The compensation payable in respect of an estate shall be determined in accordance with the following provisions. " 545 "25. The compensation shall be determined for the estate as a whole, and not separately for each of the interests therein. " The mode of computation of the compensation amount for which provision is made in sections 27 to 30 all proceed on the basis that it is the entire estate that is taken over and not a portion merely of the estate. All these, taken together, would point to the scheme of the Act contemplating the entire estate being taken over. On that scheme he urged that it would not be possible to work out the compensation payable for separate portions of an estate, for instance for one village out of the several which might be comprised in an estate, The claims by the proprietor against the Government for compensation, as well as the determination of disputes inter se between claimants to the compensation amount, he pointed out, all proceed on the basis that the entire estate as a unit was taken over by notification under section 1(4). On these premises Mr. Viswanatha Sastri submitted that what the Government had done in the present case was to deal with the two estates of Gangole 'A ' and Gangole 'C ' each of which was a unit, as if each one of them were really two estates one that which lay in the Agency tract, and the other outside that area and had issued notifications in respect of these units piece meat which was not contemplated and therefore not permitted under the Abolition Act. He further pointed out that if the original notification dated August 15, 1950, stood without the "denotification" effected by the notification dated September 5, 1950, there might be a valid vesting by reason of the retrospective operation of Regulation IV of 1951. Similarly if the impugned notification of 1953, had. included not merely that portion of the estate of Gangole 'A ' and Gangole 'C ' which were within the Scheduled areas but the entirety of the two estates, that notification would not have been open to chal lenge. But the point urged was that it was only by the combined operation of (1) the notification dated August 15, 1956, as modified by that dated September 5, 1950, and (2) the notification dated January 14, 546 1953, that the entirety of the two "estates" was taken over and that this rendered the second notification invalid because it had taken over only a portion of the estate. Learned Counsel, no doubt, conceded that the taking over of those portions of Gangole 'A ' and Gangole 'C ' which were within the operation of the Abolition Act before its extension to the Scheduled areas not having been challenged, he would not be entitled to any relief in respect of the portion of the estate covered by the first notification, but his argument was that would not preclude him from disputing the validity of the last notification vesting those portions of the two estates which were within the Scheduled areas in the State. We shall now proceed to consider the tenability of these submissions. We might premise the discussion by observing that learned Counsel is right in his submission that the Abolition Act does not contemplate or make provision for the taking over of particular portions only of estates and that if the State Government having power to take over the entirety of an estate chose, however, to exclude certain portions of it from the operation of a vesting notification and took over only defined portions of an estate, this could be open to serious challenge on the ground that it was not contemplated by the scheme of the enactment. But the acceptance of this principle does not, in our opinion, compel us to answer the question pro. pounded by the learned Counsel for the appellants in his favour. To start with, it might be pointed out that it looks somewhat anomalous that learned Counsel who strongly urges that the scheme of the Act contemplates the taking over only of the entirety of an estate and not of a portion thereof, should resist a taking over which, if effective, would result in the entire estate vesting in the Government and the compensation being determined according to the rules laid down by the Act, whereas it is the invalidation of the impugned notification that would result in a partial or piece meal taking over, to the disadvantage of the proprietors to which learned Counsel very properly drew our attention. 547 As already pointed out learned Counsel 's submission was that not merely the notification dated January 14, 1953, but also the earlier one dated August 15, 1950 (as modified by the one dated September 5, 1950) was invalid as providing for vesting of parts only of an "estate" and not of it as a unit. It would also follow that if the first notification dated August 15, 1950, was valid, the impugned notification which by its operation effected the vesting of the entirety of the estate in the State could not be open to challenge as violating the principle invoked by learned Counsel. We are necessarily therefore driven to consider the validity of the first notification dated August 15, 1950, in dealing with the validity of the impugned notification of January 14, 1953. In considering this matter it is necessary to recall some of the provisions of the Abolition Act. Section 2(3) defines "an estate" as meaning, inter alia, a "zamindari estate". No doubt, as stated already, where the Abolition Act operates over the whole of "a zamindari estate", it does not contemplate the Government taking over a portion only of such "estate". But in saying this it should not be assumed that if in respect of a single estate two notifications were issued, say on the same date which together vested the entirety of the "estate" in the State under section 3, either notification or both together would be invalid or ineffective. The reason for this must obviously be that the intention of the Government was to take over the entire estate though it was being given effect to by the issue of two notifications. That would not obviously be the same thing as the Government having the liberty to pick and choose certain of the villages or certain portions of an estate leaving out others. If the Abolition Act as enacted does not 'extend to the entirety of an "estate" as defined in the Estates Land Act but only to a portion thereof, the question would be whether that portion of "the estate" which is within the operation of the Act is "an estate" within the meaning of the Act or not. On this matter there are two views possible: (1) that having regard to the Abolition Act referring to and as it were incorporating the provisions of the 548 Madras Estates Land Act, the "estates" to which the Abolition Act could apply are only those which being "Estates" within the Estates Land Act, are also wholly within the operation of the Abolition Act. In other words, even if a few acres of an "estate" as defined in the Estates Land Act were outside the operation of the Abolition Act, it would not be an "estate" which could be taken over. (2) The other view attributing a crucial value to the policy and purpose underlying the legislation, viz., a reform of land tenures and landholding by the elimination of intermediaries to treat any land held on the tenures specified and within the territorial operation of the Act as falling within the category of "estates" liable to be taken over and vested in Government. We consider that the latter view is to be preferred as being in accord with the intention of the law and as subserving its purposes. In this connection it cannot be overlooked that the entire argument of learned Counsel is built up on the definitions of an "estate" in section 2 of the Abolition Act (read with section 1(3) of that Act), and that the definitions contained there could be applied on the terms of the opening words of that section only "unless there is anything repugnant in the subject or context. " The position could possibly be better explained in these terms: Assume that Regulation IV of 1951 was not enacted. Could the State Government take over that portion of the "estate" which was within the operation of the Abolition Act or does the definition of "an estate" and the reference section 1(3) to section 3(2) of the Madras Estates Land Act of 1908 preclude the State from taking over that portion because the Act does not extend to the entirety of the "estate"? It appears to us that this question is capable of being answered only in one way, viz., that the definition of "an estate" in the Abolition Act must be limited to that portion of an "estate" which is within the operation of the Act. Any other construction would mean that if that Act did not apply to a few square yards in an estate, it ceases to be an "estate" governed by the Act, which, in our opinion, would be plainly contrary to the intention of the enactment as 547 As already pointed out learned Counsel 's submission was that not merely the notification dated January 14, 1953, but also the earlier one dated August 15, 1950 (as modified by the one dated September 5, 1950) was invalid as providing for vesting of parts only of an "estate" and not of it as a unit. It would also follow that if the first notification dated August 15, 1950, was valid, the impugned notification which by its operation effected the vesting of the entirety of the estate in the State could not be open to challenge as violating the principle invoked by learned Counsel. We are necessarily therefore driven to consider the validity of the first notification dated August 15, 1950, in dealing with the validity of the impugned notification of January 14, 1953. In considering this matter it is necessary to recall some of the provisions of the Abolition Act. Section 2(3) defines "an estate" as meaning, inter alia, a "zamindari estate". No doubt, as stated already, where the Abolition Act operates over the whole of "a zamindari estate", it does not contemplate the Government taking over a portion only of such "estate". But in saying this it should not be assumed that if in respect of a single estate two notifications were issued, say on the same date which together vested the entirety of the "estate" in the State under section 3, either notification or both together would be invalid or ineffective. The reason for this must obviously be that the intention of the Government was to take over the entire estate though it was being given effect to by the issue of two notifications. That would not obviously be the same thing as the Government having the liberty to pick and choose certain of the villages or certain portions of an estate leaving out others. If the Abolition Act as enacted does not extend to the entirety of an "estate" as defined in the Estates Land Act but only to a portion thereof, the question would be whether that portion of "the estate" which is within the operation of the Act is "an estate" within the meaning of the Act or not. On this matter there are two views possible: (1) that having regard to the Abolition Act referring to and as it were incorporating the provisions of the 548 Madras Estates Land Act, the "estates" to which the Abolition Act could apply are only those which being "Estates" within the Estates Land Act, are also wholly within the operation of the Abolition Act. In other words, even if a few acres of an "estate" as defined in the Estates Land Act were outside the operation of the Abolition Act, it would not be an "estate" which could be taken over. (2) The other view attributing a crucial value to the policy and purpose underlying the legislation, viz., a reform of land tenures and landholding by the elimination of intermediaries to treat any land held on the tenures specified and within the territorial operation of the Act as falling within the category of "estates" liable to be taken over and vested in Government. We consider that the latter view is to be preferred as being in accord with the intention of the law and as subserving its purposes. In this connection it cannot be overlooked that the entire argument of learned Counsel is built up on the definitions of an "estate" in section 2 of the Abolition Act (read with section 1(3) of that Act), and that the definitions contained there could be applied on the terms of the opening words of that section only " unless there is anything repugnant in the subject or context. " The position could possibly be better explained in these terms: Assume that Regulation IV of 1951 was not enacted. Could the State Government take over that portion of the "estate" which was within the operation of the Abolition Act or does the definition of "an estate" and the reference section 1(3) to section 3(2) of the Madras Estates Land Act of 1908 preclude the State from taking over that portion because the Act does not extend to the entirety of the "estate"? It appears to us that this question is capable of being answered only in one way, viz., that the definition of "an estate" in the Abolition Act must be limited to that portion of an "estate" which is within the operation of the Act. Any other construction would mean that if that Act did not apply to a few square yards in an estate, it ceases to be an "estate" governed by the Act, which, in our opinion, would be plainly contrary to the intention of the enactment as 549 gathered from its preamble and operative provisions. Let us suppose that instead of the problem created by a portion of the estate being in a Scheduled area and therefore though within the State outside the normal legislative power of the State Legislature, a permanently settled estate had by reason of say the State 's Reorganisation, fell both within the territory of the Madras and the Andhra States, with the result that the taking over under the Abolition Act could be operative only in regard to that portion within the State of Madras. Could it then be contended that the portion of the estate within the State of Madras did not fall within the definition of an estate and so could not be taken over by notification under section 1(4) of the Act. Indeed, the answer of the learned Counsel for the appellants to such a question was that it could be taken over but for the reason that in such a case the portions outside the State territory could not be an " estate" within the Madras Estates Land Act at all and that in consequence the inter relation between the unit constituting the estate under the Estates Land Act and the concept of an "estate" under the Abolition Act was not disrupted. But this, however, hardly suffices as a complete answer, for even after a portion of the "estate" becoming situated in a State other than Madras the State might still be governed by the "Madras Estates Land Act", though applied as the law of tile new State. What is relevant in the illustration is that along with the concept of the unit con stituting the "estate" being taken over, there is also underlying it, another principle, viz., that it is sufficient if the entirety of the estate over which the State Legislature has competence is taken over. In such a taking over the difficulty suggested by learned Counsel in working out the scheme of the Act, would not arise because the portion taken over will constitute the estate and the compensation for that unit will be worked out on the basis laid down in section 24 and those following. The other portions of the estate which are beyond the territorial operation of the enactment would continue to remain unaffected, so that the State 70 550 Government could not be in a position to take them over. We accordingly, consider that the first notification dated August 15, 1950, apart from its being binding and not open to challenge in these proceedings by the appellants, is valid and effective in law to vest the portion to which it related in the State Government. We then have Regulation IV of 1951 which brought the other portion of the estate to which the Abolition Act did not originally extend within the operation of that enactment. If, after this change in the law, the Government did not take over the rest of the estate, it would be open to the objection that the State Government had artificially split up the estate into two parts and had taken over or rather retained in its possession one part, and that notwithstanding that the Act posited the unit constituting an estate being taken over, had departed from that principle. The impugned notification therefore far from being invalid, was necessary to be issued in order to satisfy the very principle which learned Counsel for the appellants submits as the one underlying the scheme of the Abolition Act. We therefore hold that the challenge to the validity of the impugned notification dated January 14, 1953, should be repelled. We have thus reached the same conclusion as the learned Judges of the High Court, though by a different line of reasoning. The appeals fail and are dismissed with cost one set. Appeals dismissed.

The areas in question which were parts of two estates belonging to the appellants, called Gangole A and Gangole C, were situated in what was known as the Godavari Agency tract which was governed by the Scheduled Districts Act, 1874. By section 92 of the Government of India Act, 1935, no Act of the Provincial Legislature was applicable to certain areas in which the Godavari Agency was included, unless the Governor by public 536 notification so directed. The Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948, was enacted in 1948, and on August 15, 1950, the Government of Madras issued a notification under section 1(4) Of the Act by which, among other estates, Gangole A and Gangole C in their entirety were purported to be taken over, specifying September 7, 195o, as the date on which the vesting was to take place. But as no action as contemplated by section 92 of the Government of India Act, 1935, had been taken to render the Madras Act of 1948 applicable to the Godavari Agency tract, only parts of the Gangole estates were within the operation of that Act, while there were portions of the estates which were outside its purview and operation. When this legal situation was noticed another notification was issued on September 5, 1950, by which the areas in question were excluded from the scope of the notification dated August 15, 1950. In exercise of the power under para 5(2) Of the Fifth Schedule to the Constitution, Madras Regulation IV of 1951 was passed on September 8, 1951 by which, inter alia, the Act Of 1948 was made applicable to the areas in which the two Gangole estates were situate with retrospective effect from April 19, 1949. On January 14, 1953, the Government of Madras issued a notification vesting those portions of the Gangole estates to which the Act Of 1948 was extended. The appellants challenged the legality of the notification on the ground that the various provisions of the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948, showed that the Act contemplated the taking over of estates as a unit and not in parts, while what the Government had done in the present case was to deal with the two estates of Gangole A and Gangole C as if each one of them were really two estates, one that which lay in the Godavari Agency tract and the other outside that area, and had issued notifications in respect of these units separately. Held, that the first notification dated August 15, 1950, as modified by that dated September 5, 1950, was valid and effective in law to vest the portion of the estate to which it related in the State Government. Held further, that the notification dated January 14, 1953, was equally valid. The action taken by the Government in issuing the said notification was in conformity with the scheme of the Act of 1948 that the entirety of the estate should be taken over.

l Appeals Nos. 280 and 281 of 1960. Appeal from the judgment and order dated April 20, 1956, of the Madras High Court, in T. R. C. Nos. 101 and 102 of 1956. B. Ganapathy Iyer and G. Gopalakrishnan, for the appellant. M. M. Ismail and T. M. Sen, for the respondent. 572 D. V. Sastri and T. M. Sen, for Intervener No. 1. Naunit Lal, for Intervener No. 2. section M. Sikri, Advocate General, Punjab and D. Gupta, for Intervener No. 3. section M. Sikri, Advocate General, Punjab, N. section Bindra and D. Gupta, for Intervener No. 4. G. C. Kasliwal, Advocate General, Rajasthan, section K. Kapur and D. Gupta, for Intervener No. 5. 1961. April 28. The Judgment of the Court was delivered by section K. DAS, J. These are two appeals on certificates granted by the High Court of Madras and consolidated by its orders dated March 22, 1957. They are from the judgment and orders of the said High Court dated April 20, 1956 and July 30, 1956 in two Tax Revision Cases, by which the High Court dismissed two petitions filed by the appellants under section 12 B of the Madras General Sales Tax Act (Madras Act IX of 1939), hereinafter called the principal Act, in the fol lowing circumstances. Messrs. George Oakes (Private) Limited, appellants herein, are dealers in Ford motor cars, spare parts and accessories. For the two years 1951 52 and 1952 53 the appellants submitted their returns under the relevant provisions of the principal Act and claimed exemption from tax with regard to certain amount realised on transactions of sales which the appellants contended were inter State sales and hence exempt from tax under article 286 of the Constitution as it stood at the relevant time. The Deputy Commercial Tax Officer, Madras, not only rejected the claim of exemption, but added to the turnover certain amounts which the appellants had collected by way of tax. The amounts so added for 1951 52 were (a) Rs. 8,000 to the net turnover assessable at 3 pies per rupee, and (b) Rs. 4,30,000 to the turnover assessable at 9 pies per rupee. For 1952 53 the amounts so added were (a) Rs. 30,132 odd and (b) Rs. 2,92,257 odd res pectively. Aggrieved by the orders of the Deputy Commercial 573 Tax Officer, the appellants preferred two appeals to the Special Commercial Tax Officer, Appeals, Madras City. These appeals were dismissed. The matter was then taken to the Sales Tax Appellate Tribunal by means of two appeals. By this time the Madras Legislature had passed the Madras General Sales (Definition of Turnover and Validation of Assessments) Act, 1954, being Madras Act No. XVII of 1954. This Act we shall refer to as the impugned Act in this judgment, because its constitutional validity is now the only question for decision in these appeals. The Tribunal negatived the claim of the appellants arising out of the contention that some of the sale transactions in the relevant years were in effect interState sales and therefore exempt from tax; the tribunal declined to go into the second question of the constitutional validity of the impugned Act. We may state here, though nothing now turns upon this, that the Tribunal held that when sales tax was included in the turnover, it was proper to tax the amounts so included at the minimum rate only, viz., 3 pies in the rupee under section 3(1) of the principal Act. Thereafter the appellants filed two revision petitions to the High Court under section 12 B of the principal Act. These were dismissed in limine. By the orders dated April 20, 1956 the High Court held that the contention as to some of the transactions being inter State sales was concluded by one of its earlier decisions, which came before us in Ashok Leyland Ltd. vs The State of Madras, Civil Appeal No. 446 of 1958. In that appeal we delivered judgment on March 28, 1961 and held that the Sales Tax Laws (Validation) Act, 1956 applied and it was unnecessary to consider the true nature of the transactions which the appellants contended were inter State sales. Learned Counsel for the appellants has conceded before us that decision governs the present appeals, and the first question no longer survives. As to the second question, the High Court by oversight did not deal with it in its orders dated April 20, 1956. When the matter was brought to the notice of 73 574 the High Court, it said in its orders dated July 30, 1956 that the second question was also concluded by its decision in Sri Sundararajan and Co., Ltd. vs The State of Madras( ') where the validity of the impugned Act was upheld. When we heard these appeals along with Ashok Leyland Ltd. vs The State of Madras, Civil Appeal No. 446 of 1958, we expressed the view that there was some divergence of opinion in the High Courts on the second question and the substantial point for consideration before us was whether the impugned Act was validly made under entry 54 of the State List in the Seventh Schedule to the Constitution: thus the question raised was one of legislative competence and affected all the States. The State of Madras was already a party respondent to these appeals. Accordingly, we directed the issue of notices to the Advocates General of all other States also. In pursuance of the said notices the Advocates General of Andhra Pradesh, Assam, West Bengal, Gujarat, Maharashtra, Punjab and Rajasthan have appeared before us. They have unanimously supported the State of Madras in its submission that the impugned Act is valid; some of them have added supplementary arguments in support of that submission. For convenience and brevity we shall refer in this judgment to the main arguments as representing two differing points of view; firstly, there is the argument on behalf of the appellants that the several provisions of the principal Act as also section 2 of the impugned Act make a distinction between the sale price of goods sold and the amount collected by way of tax and in view of that distinction made, What the impugned Act seeks to impose is a 'tax on Sales tax ' a subject which does not come within the ambit of entry 54 of List II which at the relevant time read as "Taxes on the sale or purchase of goods other than newspapers. " On the other side, the argument is that what the impugned Act seeks to do is to enlarge the scope of the definition of 'turnover ' so as to include the amount collected by way of tax in the turnover by a deeming (1) (1956) 7 S.T.C. 105. 575 provision, and this the State Legislature was competent to enact under entry 54 of the State List. These are the main arguments on two sides; but there are several subsidiary points in support of the main argument on each side, and it would be an over simplification to ignore these altogether. We shall, therefore, consider them also when dealing with the main argument on each side. We shall first refer to the relevant provisions of the principal Act and of the impugned Act, in so far as they bear on the points debated before us. Under section 3 of the principal Act which is the charging section, every dealer is liable to pay, subject to the provisions of the Act, for each year a tax on his total turnover for that year calculated at a particular percentage of such turnover. What is 'turnover ' is defined in section 2(i). The definition substantially states " 'turnover ' means the aggregate amount for which goods are either bought or sold by a dealer whether for cash or for deferred payment or other valuable consideration. . 'Sale ' is defined in section 2(h) and means (we are reading so much of the definition only as is material for our purpose) "every transfer of property in goods by one person to another in the course of trade or business for cash or deferred payment or other valuable consideration. " It is worthy of note here that the tax imposed by the principal Act is a tax on total turnover, and turnover means the aggregate amount for which goods are either bought or sold by a dealer. Therefore, one of the questions which fall for consideration is whether the State Legislature went beyond its legislative competence in enacting by the impugned Act that the amounts collected by the dealer by way of tax shall be deemed to have formed part of his turnover. This brings us to section 8B of the principal Act, which provides in sub section (1) that no person who is not a registered dealer shall collect any amount by way of tax; nor shall a registered dealer make any such collection except in accordance with such conditions and restrictions, if any, as may be prescribed; sub section (2) provides inter alia that every person who has collected or collects by way of tax any amounts shall pay 576 over the same to the State Government. Section 15 provides for penalties for a, contravention of some of the provisions of the principal Act including the provisions of section 8B. In The Deputy Commissioner of Commercial Taxes, Coimbatore Division vs M. Krighnaswami Mudaliar & Sons (1) the Madras High Court held that the amount collected by a registered dealer from the consumer by way of sales tax and paid over to Government should not be included in the turnover of the registered dealer as part of the sale price of the goods sold and it was not liable to be taxed again. This decision was given on January 7, 1954. In July 1954 was enacted the impugned Act sections 2 and 3 whereof need only be set out here. "section 2. Sales Tax Collections by dealers to be deemed part of turnover. In the case of sales made by a dealer before the 1st April 1954, amounts collected by him by way of tax under the Madras General Sales Tax Act, 1939 (Madras Act IX of 1939) (hereinafter referred to as the principal Act), shall be deemed to have formed part of his turnover. Validation of certain assessment and collections. (1) All assessments, and collections made, all orders passed, all actions taken by any officer in the exercise or purported exercise of jurisdiction or power conferred by the principal Act, and all judgments, decrees or orders pronounced by any Tribunal or Court in the exercise of its jurisdiction or powers with respect to matters in the principal Act, on the basis that amounts collected by a dealer by way of tax under the principal Act before the 1st April 1954, formed part of the turnover of the dealer are hereby declared to have been validly made, passed, taken or pronounced, as the case may be; and any finding recorded by any officer, Tribunal or Court to a contrary effect and any order, judgment or decree in so far as such order, judgment or decree embodied or is based on any such finding and does not relate merely to the costs of the proceeding which result in the judgment, decree or order shall be void and of no effect: (2) [1954] 5 S.T.C. 88. 577 Provided that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable if this Act had not been passed. (2) Nothing in sub section (1) shall be construed as authorising any officer, in assessing any dealer in s the exercise or purported exercise of jurisdiction or powers conferred by the principal Act, to include in the turnover of the dealer amounts collected by him after the 1st April 1954 by way of tax under the principal Act. " The validity of the impugned Act was then questioned in the Madras High Court and in Sri Sundararajan and Co., Ltd. vs The State of Madras (1) it was held that the impugned Act was valid. The High Court pointed out that the earlier decision in Krishnaswami Mudaliar 's case (2) was not that the State Legislature could not make the amounts collected by a registered dealer by way of tax under section 8B part of the assessable turnover, but that the principal Act as it stood at the relevant time did not make such amounts part of the assessable turnover. It held that in pith and substance the impugned Act validated the assessments already made before April 1, 1954 and that even where the registered dealer collected any amount by way of tax under the authority of section 8B, the payment by the purchaser was on the occasion of the sale by the dealer and vis a vis the latter it was in reality part of the price the purchaser paid the seller for purchasing the goods. The same view was also expressed by the Patna High Court in Ashoka Marketing Company Ltd. vs The State of Bihar (3) with regard to the Bihar Sales Tax (Definition of Turnover and Validation of Assessments) Act, 1958. The question before us is whether the aforesaid view is correct. The relevant legislative entry, as we have said earlier, is entry 54 of List II "Taxes on the sale or purchase of goods other than newspapers. " A similar entry (No. 48) in List 11 of Schedule VII to the Government of India Act, 1935 read as "Taxes on the (1) [1956] 7 S.T.C. 105. (2) [1954] 5 S.T.C. 88. (3) [1959] 10 S.T.C. 110, 578 sale of goods." The true scope and effect of that entry was considered by this Court in the State of Madras vs Gannon Dunkerley and Co. (Madras) Ltd. (1) and on a review of several decisions bearing on the subject it held that the expression "sale of goods" was a term of well recognised legal import in the general law relating to sale of goods and in the, legislative practice relating to that topic and must be interpreted as having the same meaning as in the ; in other words, it was held that sales contemplated by entry 48 of the Government of India Act, 1935 were transactions in which title to the goods passed from the seller to the buyer, and in The Sales Tax Officer, Pilibhit vs Messrs. Budh Prakash Jai Prakash (2) it was held that a mere executory agreement was not a sale within the meaning of that entry. We think that the same meaning must be given to entry 54 of List 11 of the Seventh Schedule to the Constitution. The question before us is that giving that meaning to the entry, is the impugned Act a valid piece of legislation by a competent Legislature? Now, learned Counsel for the appellants has not raised before us the extreme contention that in no case could the State Legislature validly make a law which would include the amount collected by way of tax as part of the turnover of the dealer. He has submitted that it is unnecessary for him in this case to press into service any such wide proposition. His argument is that the principal Act by sections 8B and 15 and the impugned Act by section 2 thereof having made a distinction between what he calls the sale price and what is collected by way of tax by the dealer, the question of the validity of the impugned Act must be determined on the basis of that distinction and so determined, what the impugned Act does is to impose what learned Counsel calls "a tax on tax" and therefore not covered by the relevant legislative entry. His submission further is that what is collected by way of tax being distinct from sale price and therefore from turnover, it must be necessarily held that the amount collected by way of tax is not essentially (1) ; (2) ; 579 connected with the transaction of sale and therefore the imposition of "a tax on tax" has no necessary connexion with the transaction of sale as understood in the general law relating to sale of goods. We are unable to accept this argument as correct. First of all, we do not think that either the principal Act or the impugned Act proceeds,on any immutable distinction between sale price and tax such as learned Counsel for the appellants has suggested. The principal Act does not contain any separate definition of sale price. We have already referred to the definitions of 'sale ' and 'turnover '; those definitions do not show any such distinction. On the contrary, the expression 'turnover ' means the aggregate amount for which goods are bought or sold, whether for cash or for deferred payment or other valuable consideration, and when a sale attracts purchase tax and the tax is passed on to the consumer, what the buyer has to pay for the goods includes the tax as well and the aggregate amount so paid would fall within the definition of turnover. In Paprika Ltd. and Another vs Board of Trade (1) Lawrence, J. said "Whenever a sale attracts purchase tax, that tax presumably affects the price which the seller who is liable to pay the tax demands but it does not cease to be the price which the buyer has to pay even if the price is expressed as x plus purchase tax." The same view was again expressed in Love vs Norman Wright (Builders), Ltd. (2) when Goddard, L. J. said: "Where an article is taxed, whether by purchase tax, customs duty, or excise duty, the tax becomes part of the price which ordinarily the buyer will have to pay. The price of an ounce of tobacco is what it is because of the rate of tax, but on a sale there is only one consideration though made up of cost plus profit plus tax. So, if a seller offers goods for sale, it is for him to quote a price which includes the tax if he desires to pass it on to the buyer. If the buyer agrees to the price, it is not for him to consider how it is made up or whether the seller has included tax or not. " (1) (2) 580 We think that these observations are apposite even in the context of the provisions of the Acts we are considering now, and there is nothing in those provisions which would indicate that when the dealer Collects any amount by way of tax, that cannot be part of the sale price. So far as the purchaser is concerned, he pays for the goods what the seller demands, viz., price even though it may include tax. That is the whole consideration for the sale and there is no reason why the whole amount paid to the seller by the purchaser should not be treated as the consideration for the sale and included in the turnover. But, argues learned Counsel for the appellants, section 8 B of the principal Act and Turnover and Assessment Rules made under section 19 show that under the scheme of the principal Act a distinction is drawn between the amount collected by way of tax and the amount of purchase price. It is indeed true that in section 8 B the amount collected by way of tax is separa tely mentioned, and while sub section (1) thereof is merely enabling in the sense that a registered dealer may pass on the tax, sub section (2) imposes an obligation on the registered dealer to pay over the amount of tax collected by him to Government. The position under the Turnover and Assessment Rules is correctly summarised in the following extract from the judgment in Krishnaswamy Mudaliar 's case (1): "Rule 4 provides that the gross turnover of a dealer for the purposes of the rules is the amount for which goods are sold by the dealer. Provision is made in rule 5 for certain deductions, and the mode or manner in which the tax to be levied has to be arrived at. The object of these rules is to assess. , the net turnover on which the tax is to be levied under the charging section. It is therefore clear that under the charging section, tax is to be paid on the turnover which is assessed according to the rules. Rule 11 requires that every dealer should submit a return under rule 6 every year to the assessing authority in Form A in which he has to show the actual gross and net turnover for the preceding (1) [1954] 5 S.T.C. 88. 581 year and the amounts by way of tax or taxes actually collected during that year. In Form A columns 1 to 10 relate to the gross turnover and the deductions to be made from the gross turnover; column 10 requires the net turnover liable to tax to be shown. In column 11 the amount actually collected by way of tax or taxes under section 8 B has to be shown. " The question however still remains do the aforesaid provisions show such a distinction under the scheme of the two Acts that the amount collected by way of tax cannot be part of the turnover of the dealer and if the impugned Act makes it a part of the turnover by a deeming provision, it must be struck down as being outside the legislative competence of the State Legislature? It is necessary to emphasise here that no question of legislative competence arose in Krishnaswamy Mudaliar 's case( ') the decision being based on a construction of section 8 B and the Turnover and Assessment Rules only. We do not think that the distinction drawn in Krishnaswamy Mudaliar 's case( ') whether right or wrong on a question of construction only, is material to the question of legislative competence. In The Tata Iron & Steel Co., Ltd. vs The State of Bihar (2) this Court dealt with a provision in the Bihar Sales Tax Act, 1947 similar to section 8 B of the principal Act. Das, C. J., delivering the majority opinion said: "The circumstance that the 1947 Act, after the amendment, permitted the seller who was a registered dealer to collect the sales tax as a tax from the purchaser does not do away with the primary liability of the seller to pay the sales tax. This is further made clear by the fact that the registered dealer need not, if he so pleases or chooses, collect the tax from the purchaser and sometimes by reason of competition with other registered dealers he may find it profitable to sell his goods and to retain his old customers even at the sacrifice of the sales tax. This also makes it clear that the sales tax need not (1) [1954] 5 S.T.C. 88. (2) ; 74 582 be passed on to the purchasers and this fact does not alter the real nature of the tax which, by the express provisions of the law, is cast upon the seller. The buyer is under no liability to pay sales tax in addition to the agreed sale price unless the contract specifically provides otherwise. See Love, vs Norman Wright (Builders), Ltd. L. R. These observations show that when the seller passes on the tax and the buyer agrees to pay sales tax in addition to the price, the tax is really part of the entire consideration and the distinction between the two amounts tax and price loses all significance from the point of view of legislative competence. The matter is not in any way different under the Turnover and Assessment Rules. It is true that in column 11 of Form A the amount collected by way of tax under section 8 B has to be shown; that does not, however, mean that an immutable distinction such as will go to the root of legislative competence has been drawn and must be always maintained. It appears to us that the true effect of section 8 B and the Turnover and Assessment Rules is that (a) a registered dealer is enabled to pass on the tax, (b) an unregistered dealer cannot do so, and (c) the amount collected by way of tax is to be shown separately, for it has to be paid over to Government. This does not mean that it is incompetent to the legislature enacting legislation pursuant to entry 54 in List 11 by suitable provision to make the tax paid by the purchaser to the dealer together with the sale price in consideration of the goods sold, a part of the turnover of the dealer; nor does it mean that in law the tax as imposed by Government is a tax on the buyer making the dealer a mere collecting agency so that the tax must always remain outside the sale price. There is another aspect from which the question may be considered. We shall assume that under the ,scheme of the principal Act a distinction is drawn between the amount collected by way tax and the sale price other than the tax. Is such a distinction continued and maintained by the impugned Act? Learned Counsel for the appellants has referred us to 583 section 2 of the impugned Act where the expression "collected by him by way of tax under the Madras General Sales Tax Act, 1939" occurs. It is argued that the aforesaid expression in the impugned Act has to be read with the provisions of the principal Act and so read, B. 2 maintains and continues the distinction made under the principal Act. Again, we are unable to agree. The expression "collected by him by way of tax etc." is merely descriptive of the "amounts" so collected; the essential and operative part of section 2 says that the amounts so collected shall be deemed to have formed part of the turnover of the dealer. Therefore, in express terms section 2 states that the tax shall be deemed to have formed part of the turnover and obliterates the distinction, if any, between 'tax ' and 'turnover ' for the limited period during which the impugned Act operates. To hold that the distinction is maintained and continued under the impugned Act is to go against the express terms of section 2. This aspect of the question was adverted to in The Government of Andhra vs East India Commercial Co. Ltd. (1) where the Andhra High Court had occasion to consider the question from a somewhat different point of view, namely, an amendment made by the Andhra Pradesh Legislature in the definition of the expression 'turnover ' in the principal Act. Section 2 of the amending Act substituted the following definition of 'turn over ': Turnover means the total amount set out in the bill of sale (or if there is no bill of sale, the total amount charged) as the consideration for the sale or purchase of goods . including any sums charged by the dealer for anything done in respect of the goods sold at the time of or before the delivery of the goods and any other sums charged by the dealer, whatever be the description, name or object thereof. " Section 4 of the amending Act repeated sections 8 B and 8 C of the principal Act. Dealing with the effect of these amendments, the High Court of Andhra Pradesh said, (1) [1957] 8 S.T.C. 114. 584 "The ultimate economic incidence of the sales tax is on the consumer or the last purchaser and whatever he pays for the goods is paid only as price, that is to say, as consideration for the purchase. The statutory liability, however, for payment of sales tax is laid on the dealer on his total 'turnover ' whether or not he realises the tax from the purchasers. Generally speaking, the price charged by the dealer would be inclusive of sales tax, for, it is to his interest to pass the burden of the tax to the purchaser. So far as the dealer is concerned, the payment of a sum covering the tax made by a purebaser on the occasion of sale, is really part of the price which the purchasers pay for the goods. " Later, it referred with approval to the decision in Sri Sundararajan and Co., Ltd. vs The State of Madras (1). In this latter decision the validity of the impugned Act was questioned and dealing with section 2 of the impugned Act, the High Court said: "Section 2 only enacted that such amount shall be deemed ' to be part of the turnover and for a limited period. It may not be necessary to set out authorities for the well settled principle of what the effect is of the use of the expression 'deemed ' in a statute. Was the legislature competent to enact section 2 including the deeming provision, is the real question. If the validity of section 2 of the impugned Act is established there should be little difficulty in upholding the validity of section 3, which gave effect to the legal fiction enacted by section 2. Obviously, it is not the name the legislature accords to a payment by a purchaser to a seller, who is a dealer as defined by the Act, that determines the question of the legislative competence. No doubt section 8B called the payment as amount (collected) by way of tax. It is equally true that the statutory liability to pay the sales tax is laid on the dealer. What is taxable is not each transaction of sale but the total turnover of the dealer, computed in accordance with the provisions of the (1) (1956) 7 S.T.C. 105. 585 Act and the Rules. But it is well recognised that whatever be the form of the statutory provisions, the ultimate economic incidence of the tax is on the consumer, the purchaser. It was that well settled principle that was re stated in Bengal Immunity Co. Ltd. vs State, of Bihar (1). Even if the registered dealer collects the amount by way of tax under the authority of section 8B of the Act, the payment is by the purchaser on the occasion of the sale by the dealer. Vis a vis the dealer it is in reality part of the price the purchaser has to pay the seller for purchasing the goods. A tax on such a payment, in our opinion, is well within the ambit of Entry 54 of List 11, Schedule VII, read with Article 246(3) of the Constitution. " We are of the view that the aforesaid observations correctly give the true effect of section 2 of the impugned Act, and section 3 of the impugned Act is merely consequential. Mr. Sikri appearing on behalf of. the States of Maharashtra and Punjab has drawn our attention to certain American decisions which show that treating tax as part of the sale price in cases where the tax is passed on to the buyer, is well recognised and is not unknown to law (see Lash 's Products Company vs United States, 73 L. Edn. 251; Pure Oil Company vs State Of Alabama, 148 American Law Reports 260). We consider it unnecessary to examine these decisions, because the validity of the impugned Act must be determined on its own terms in the context of the provisions of the principal Act. Reading the impugned Act in the light of the provisions of the principal Act, it seems clear to us that the impugned Act cannot be held to be bad on the ground of legislative incompetence. Under the definition of turnover the aggregate amount for which goods are bought or sold is taxable. This aggregate amount includes the tax as part of the price paid by the buyer. The amount goes into the common till of the dealer till he pays the tax. It is money which he keeps using for his business till he pays it over to Government. Indeed, (1) 586 he may turn it over again and again till he finally hands it to Government. There is thus nothing anomalous in the law treating it as part of the amount on which tax must be paid by him. This conception of a turnover is not new. It is found in England and America and there is no reason to think that when the legislatures in India defined 'turnover ' to include tax also, they were striking out into something quite unknown and unheard of before. The only question which has been raised in these appeals is regarding the validity of the impugned Act. That question having been decided against the appellants, the appeals fail and are dismissed with costs. One hearing fee. Appeals dismissed.

Certain amounts collected by the appellants as sales tax were included in their turnover by the sales tax authorities. They contested the constitutional validity of the Madras General Sales (Definition of Turnover and Validation of Assessments) Act, 1954, on the ground inter alia that the Sate Legislature went beyond its legislative competence under entry 54 of List If of the Constitution in enacting by the impugned Act that the amounts collected by the dealer by way of tax shall be deemed to have formed part of his turnover. Held, that entry 54 of List II of the Seventh Schedule of the Constitution is similar to entry 48 of List 11 of Sch. Vil of the Government of India Act, 1935 sales under which have been held to be transactions passing title to the Goods from the seller to the buyer and that a mere executory agreement was not a sale within the meaning of that entry. The same meaning must be given to entry 54. 571 State of Madras vs Gannon Dunkerly & Co., Ltd., ; and Sales Tax Officer vs M/s. Budh Prakash jai Prakash; , , referred to. Under sections 2(i) and 2(h) of the Madras General Sales Tax Act, 1939, the expression "turnover" means the aggregate amount for which goods are sold either for cash or deferred payment or other Valuable consideration, and when a sale attracts purchase tax which is passed on to the consumer what the buyer has to pay includes the tax and the aggregate amount to be paid would fall under the definition of turnover. When the seller passes on the tax and the buyer agrees to pay sales tax in addition to the price, the tax is really part of the entitle considerations. Papreka Ltd. vs Board of Trade, , Love vs Norman Wright (Builders) Ltd., , followed. Asoka Marketing Co. Ltd. vs The State of Bihar, [1959] IO S.T.C. 110 and Tata Iron and Steel Co. vs The State of Bihar, ; , referred to. Although section 8B of the Madras General Sales Tax Act, 1939 and the Turnover and Assessment Rules separately mentioned the amounts collected as tax for the purpose of paying such amounts to the Government, no immutable distinction was drawn between the sale price and the tax nor was any such distinction maintained under section 2 of the impugned Act. Assuming that such a distinction did exist the Legislature was competent to enact under entry 54 in List II of the Constitution that the tax shall be deemed to have formed part of the turnover and obliterate the distinction for the limited period during which the impugned Act operated. The impugned Act was therefore valid. The Deputy Commissioner of Commercial Taxes vs M. Kyishna swami Mudaliar, [1954] 5 S.T.C. 88, held not applicable. Sri Sundararajan & Co. vs The State of Madras, [1956] 7 S.T.C. 105, approved. The Government of Andhya vs East India Commercial Co., Ltd., [1957] 8 S.T.C. 114 and Bengal Immunity Co., Ltd. vs State Of Bihar,[1955] 2 S.C.R. 603, referred to.

minal Appeal No. 341 of 1960. Appeal by special leave from the judgment and order dated July 20, 1960, of the Bombay High Court in Criminal Appeals Nos. 488, 426 of 1960 with Review Application. 555 and 641 of 1960. G. C. Mathur, for the appellant. B.R.L. Iyengar and D. Gupta, for the respondent. May 4. The Judgment of Kapur, Subba Rao and Shah, JJ. was delivered by Kapur, J., and the judgment of Hidayatullah and Dayal JJ., was delivered by Dayal, J. KAPUR, J. This is an appeal against the judgment and order of the High Court of Bombay imposing the sentence of death in appeal by the State against the order passed by the Sessions Judge, Dhulia. The facts of the appeal are these: The appellant, in about 1950, married Sindhubai the daughter of Chandrabhagabai. Sindhubai who is the deceased had read up to the 7th Standard. The appellant and Sindhubai were residing in a one room tenement in a house belonging to one Tavar pleader in which there 'are in all 12 to 15 tenements. The tenement of the appellant was not very far from ' that of the appellant 's cousin Shantabai who was residing with her husband Pandu Genda and the house of 777 Cliandrabhagabai was about a furlong away from that of the appellant. The relations between the appellant and the deceased were normal for sometime but about two years before the occurrence differences had arisen and there were frequent quarrels between them. A child of the marriage was born about 1 1/2 years before the occurrence. The deceased was a frequent visitor to her mother 's house to which the appellant took objection. The appellant bad stopped giving her the necessities of life including foodgrains etc. About a week before Diwali the appellant gave her a beating. The deceased used to have her meals with her mother and the appellant with his cousin Shantabai and the daughter of the marriage Urmila stayed with the mother of the deceased during the day time. The occurrence was on the Bhaubij day i.e. November 2, 1959 between 1.30 and 3.30 in the afternoon. After having her meals at her mother 's house the deceased returned to her husband 's house and went to sleep in the afternoon. It is stated that while she was sleeping the appellant gave her a beating and after sprinkling Kerosene oil on her clothes, set fire to them. The deceased with her clothes burning went in the direction of the house of Shantabai but fell down in front of it and was almost naked when some body covered her body with a dhoti. Chandrabhagabai received information, it is stated, from her nice Suman about this fact and Chandrabhagabai ran to the spot, and found her body burnt. The cousin, Shantabai and her husband Pandu Genda also arrived and on enquiry by Chandrabhagabai the deceased told her that her husband had set fire to her clothes after sprinkling kerosene oil on her. By this time a police constable informed the Police Station which was nearby and an ambulance car was sent and the deceased was taken to the Civil Hospital, Dhulia at about 4 15 P.m. She was examined by Dr. Javeri who 778 treated her and on his enquiry the deceased told him that her husband had set fire to her clothes after sprinkling kerosene oil on her clothes. Dr. Javeri then informed the police and advised that a dying declaration be recorded. At about 5 30 P.m. a Magistrate Mr. Mhatre recorded the statement of the deceased but she died at 8 15 P. M. on the same day in the hospital. The defence of the appellant was that of alibi, in that he was at work on the house of Mulchand Rajmal at Nehru Nagar which was being built and that he was entirely innocent of the offence. The trial court found that it was the appellant who had set fire to the clothes of the deceased after sprinkling kerosene oil; that the appellant had the intention of causing such bodily injury to the deceased as was likely to cause death and it therefore convicted the appellant of an offence under section 304 Part 1 and sentenced him to three years ' rigorous imprisonment and a fine of Rs. 100/ . The learned judge accepted the testimony of the mother Chandrabhagabai as to the dying declaration and also that of Dr. Javeri and finally he accepted the dying declaration recorded by the Magistrate which was in the form of questions and answers. In all her dying declarations the deceased had accused the appellant of setting fire to her clothes and thus causing her severe bums. The State took an appeal to the High Court which convicted the appellant of an offence under section 302, Indian Penal Code and sentenced him to death. Against that judgment and order the appellant applied for certificate to appeal to this Court under article 134 (1) (a) but the certificate was refused and this Court gave special leave under article 136 of the Constitution. The first question for decision is whether the appellant had a right of appeal to this Court under article 134 (1) (a) and the decision of that must depend 779 upon the construction to be put on the language used in that Article the relevant portion of which is as follows: 134 (1) ""An appeal shall lie to the Supreme Court from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India if the High Court. (a) has on appeal reversed an order of acquittal of an accused person and sentenced him to death. " If the High Court reverses an order of acquittal of an accused person and sentences him to death an appeal shall lie as of right to this Court under the Article. The argument raised on behalf of the appellant was that as the appellant was acquitted of the offence of section 302 and was convicted under section 304 Part 1 it was a case of reversing an order of acquittal. The argument on behalf of the State was that the word acquittal meant complete acquittal. The decision of this must depend upon the construction of the word "acquittal". If a person is acquitted of the offence charged and is convicted of a lesser offence, as in the present case, can it be said that he was acquitted and the High Court had on appeal reversed the order of acquittal. " In our opinion the word "acquittal ? does not mean that the trial must have ended in a complete acquittal of the charge but acquittal of the offence charged and conviction for a minor offence (than that for which the accused was tried) is included in the word ", 'acquittal". This view has the support of a judgment of the judicial Committee of the Privy Council in Kishan Singh vs The King Bmperor (1). In that case an accused person was tried by the Sessions Judge under section 302 of the Indian Penal Code on a charge of murder but was convicted under section 304 for culpable homicide not amounting to murder, the Court having power to do that under section 238 (2) of the Criminal Procedure Code. He was sentenced to (1) (1928) L.R. 55 I.A. 390. 780 five years ' rigorous imprisonment. No acquittal of the charge under section 302 was recorded. There was no appeal to the High Court by the then local Government but, it applied for revision under section 439 on the grounds that the appellant should have been convicted of murder and the sentence was inadequate. The High Court convicted the appellant of murder and sentenced him to death. On appeal to the Privy Council it was held that the finding of the trial court was to be regarded as an acquittal on the charge of murder and that under section 439 (4) Criminal Procedure Code the word "acquittal" did not mean complete acquittal. At page 397 Sir Lancelot Sanderson observed: "Their Lordships, however, do think it necessary to shy that if the learned Judges of the High Court of Madras intended to hold that the prohibition in section 439 sub section 4 refers ' only to a case where the trial has ended in a complete acquittal of the accused in respect of all charges or offences, and not to case such as the present, where the accused has been acquitted of the charge of murder, but convicted of the minor offence of culpable homicide not amounting to murder, ' their Lordships are unable to agree with that part of their decision. The words of the sub sec tion are clear and there can be no doubt as to their meaning. There is no justification for the qualification which the learned Judges in the cited case attached. to the sub section. " We are in respectful agreement with the interpretation put on the word "acquittal" by the Judicial Committee of the Privy Council and the word "acquittal" therefore does not mean that the trial must have ended in a complete acquittal but would also include the case where an accused has been acquitted of the charge of murder and has been convicted of a lesser offence. In that view of the matter the appellant was entitled, to a certificate 781 under article 134 (1) (a) as a matter of right and this appeal must be treated as if it is under that provision of the Constitution. The facts of this appeal have been set out above. In support of the prosecution the evidence mainly, if not solely, consists of the dying declarations. The first dying declaration was made to the mother Chandrabhagabai as soon as she came to the place where the deceased was lying and in answer to her question "as to who had done it," the reply was that "it was done by her husband., also that the husband had set fire to her clothes. " In cross examination she stated that at the time when this statement was made by the deceased Shantabai and her husband Pandu Gonda were present. A suggestion was made to her that the deceased implicated the appellant at the instance of Chandrabhagabai but she repudiated this suggestion and both the trial court and the. High Court have accepted the correctness of this dying declaration and also that it was not prompted by the mother Cbandrabhagabai. Beyond a mere suggestion in the cross examination there is no material to support the contention of prompting by the mother. A similar statement accusing the appellant of setting fire to her was made by the deceased to the Doctor (Dr. Javeri) who asked the deceased as to how she got the burns and her reply was that her husband had sprinkled kerosene oil on her and bad applied a match stick to her clothes. This statement was also accepted by the High Court and we find no reason to differ from that conclusion. The third dying declaration was made in the presence of and was recorded by Mr. Mhatre, a Magistrate at about 5 30 P.M. in the presence of Dr. Javeri who certified that the deceased was in a fit state of mind to make the statement. The Magistrate asked her certain questions which are set out in detail and he took down the answers and his evidence is that the deceased understood the questions and replied to them. He 782 made a record of the questions and answers but that record was not signed by her nor her thumb impression taken on it because her hands were badly burnt. This examination took about an hour. This dying declaration was held by the trial Court to have been made without the help or prompting 'of anybody and according to Chandrabhagabai she was not present at the time. The learned Trial Judge held that the dying declaration was "freely given without the influence of anybody. It was not made under influence of any personal feelings. " The High Court Also accepted the correctness of this dying declaration and there is no evidence on the record which would in any way detract from the finding of the trial Court or of the High Court,.in regard to the correctness or the propriety of this dying declaration. The argument raised before us was two fold: (1) that the appellant was not present at the place of occurrence at all and (2) that it was a case of suicide. There are no cogent grounds which would lead to the, conclusion that the deceased wanted to commit suicide nor have any circumstances been shower to us which would lead to any such conclusion. Even though it may be true that the relations between the husband and the wife, were strained so much so that the husband had almost refused to maintain the deceased and was not prepared to give her even food there is no indication that the deceased was so worked up as to have lost her self control so as to commit suicide. Certain other circumstances as to the absence of any kerosene oil on the clothes of the appellant or the absence of kerosene oil on the bedding have been pointed out but in the circumstances of this case those circumstances are of no significance. Both the trial court and the High Court have found that the deceased had died as a result, of burns 'caused by the fire set to her clothes by the appellant who had sprinkled kerosene oil on her, 783 This is supported by the dying declarations against the correctness of which no cogent reasons have been given or suggested and a conviction based on such evidence has been held to be sustainable by this Court in khushal Rao vs The State of Bombay (2). The plea of alibi was sought to be supported by the evidence of Gangaram Sitaram a co worker of the appellant but his testimony was rejected by both the trial Court and the High Court and having gone through it we find no reason to differ from that opinion. In the result this appeal fails and is dismissed. RAGHUBAR DAYAL, J. We agree that the appellant had a right of appeal under article 134 (1) (a) of the Constitution, but regret our inability to agree with the view that the conviction of the appellant under s.302, I. P. C., be maintained. In appeals preferred under article 134 (1) (a) of the Constitution , we are to assess afresh the value of the evidence of record, and do not follow the practice of this Court in appeals, by special leave, under article 136 of the Constitution, that the concurrent findings of the Courts below be not interfered with, ordinarily, but be interfered with only when special circumstances exist. We are of opinion that it is not safe in this case to base the conviction of the appellant solely on the dying declarations made by the deceased, even though in law a conviction can lawfully be based on dying declaration alone if the Court feels fully satisfied about its giving a true version of the incident. The first dying declaration was made to her mother, by the deceased. It was certainly natural for the mother to question her daughter as to how she got burnt. But that does not really mean that (2) ; 784 the daughter did state all what the mother deposes. Two points arise there, and they are : (a) Did the mother speak the truth ? and (b) Did the daughter ,speak the truth ? The mother, P.W. 1, admittedly, has not good relations with her son in law. She made discrepant statements. The Sessions Judge has remarked, in paragraph 12 of his judgment, that there were lot of discrepancies in the statements of this witness. Reference may be made to her stating at one place that when she used to request the accused not to beat the daughter, the result was adverse and denying the correctness of this statement when questioned in cross examination. According to her, only she was sent away from the room when the Magistrate recorded the dying declaration of the deceased in the hospitals indicating that the accused and some others continued to remain in the room. This statement is not borne out by Dr. Javeri or by the Magistrate. She expressed ignorance about the deceased making a statement. to the police. The Sub Inspector and Dr. Javeri deposed about her making such a statement. She could not have been ignorant about it. She deposes that the accused came to the spot where Sindhubai, the deceased, lay injured, about five minutes after her arrival, She knew that he had set fire to Sindhubai 's clothes after pouring kerosene oil on her. She did not question him about it. She did not reprimand him. She did not abuse him. She did nothing which could have, been normally expected of a mother knowing that the, accused bad burnt her daughter The explanation that she was sorrow strike, lacks the ring of truth. Grief striken she must be, but that would not have made her mute. According to her Sindbubai made this dying declaration when Shantabai, cousin of the accused, and her husband Pandu Genda were present. These witnesses have not been examined by the prosecution to corroborate her statement. 785 The other dying declaration relied on by the Courts below was made by the deceased to Dr. Javeri, on his casually questioning the deceased as to how she got injured. It may be natural, but we have our doubts, for the Doctor to put such questions to the patient in agony, which had no real connection with his duties as a medical man, and such questioning cannot be said to have any comforting effect on the patient. Such questioning can be nothing but idle curiosity which a Doctor in that position should not evince. Any way, it would not be a good precedent to rely on such a statement to the Doctor in such circumstances, when the Doctor makes no record about it, even if it be not required to be noted in the medico legal register. We would consider it safe not to rely upon such a statement made to a casual question by the Doctor, the details of which statement are not clear. The dying declaration made to the police has been ignored, the Sessions Judge considering that it was not made at all, or not made at the time the Sub Inspector deposed to have got the dying declaration from the deceased. No significance attaches to this dying declaration in any case when it was recorded after the deceased had made a formal dying declaration to the Magistrate. The dying declaration to the Magistrate has certainly been recorded with care. The relevant statements made in this dying declaration are the following "I am suffering injuries of burning. My husband is my enemy. My husband has burnt me. Kerosene was poured over my body and a match stick was lighted. I was sleeping in the house. He, i.e., my husband, beat me and then burnt me. I shouted, but nobody came. He was ill treating me. He was harassing me and was causing me starvation for 786 the last 8 days. I had complained about it to Pandu Genda and Shanta Pandu. I did not send any information to my parents about the starvation. The High Court has stated several times in its judgment that Sindhubai was sleeping when the accused set fire to her clothes. The panchnama Exhibit No. 14. prepared about the room, does not show that the bedding had any oil sprinkled over it or that it got burnt. Quite a number of other clothes were burnt, which need not have caught fire. Absence of oil on the bedding is not consistent with her statement that she was sleeping in the house when the thing happened. This statement is also not consistent with the next statement made by her that her husband beat her and then burnt her. Her statement that nobody came on her shouts because the door of the house was shut, does not fit in with her statement to the police in Exhibit 19 that the accused ran away on his work after he had set fire. The probability too is that if the accused had set fire to her clothes he would run away just after setting fire as he could expect that the victim would shout and that her shouts would attract neighbours and persons passing by. Even if the door was latched for some time while the accused remained there because he did go subsequently, that does not explain the non arrival of any person. The persons could have come and could have knocked at the door. It is really remarkable that in this case not a single witness of the neighbourbood has come to depose anything in support of the prosecution case. There is no evidence at all from an outside source. The investigation seemed to have revealed nothing whatever. , There is nothing inthe case to lend assurance to any circumstance. Surely, this cannot be the result of the accused 'sinfluence on the witnesses or the result of a general inclination not to speak the truth in the interests of justice, even when the 787 accused committed the dastardly act of setting fire to his own wife. Their absence from the witness box may be due to their not standing what they knew to be untrue or did not consider to be true. It is always a difficult question to speculate why deceased accused a certain person of committing the crime, or why a witness deposes against a person with whom he has no ostensible cause of enmity or why the police. in the discharge of its public duty should influence persons to make inaccurate statements, when Courts come to the conclusion that the accusation or the evidence does not appear to be true and that there are reasons to suppose that the. police had influenced the testimony of witnesses. Anyway, the same difficulty occurs in the present case. But it is clear that the relations between the wife and the husband were strained to such an extent that, according to the prosecution, the accused not only starved her, but also set fire to her clothes with the intention to cause her death. Such a conduct of the husband cannot be on account of ordinary domestic unpleasantness, but must be the result of a very acute feeling of desperation and a desire not to live any more with his wife. If such were the relations which one is inclined to infer from what the prosecution wants the Court to believe, it should not be difficult to imagine that the wife 's motives in charging the husband falsely may be equally strong. She too must have been fed up with the misery of her life and might have committed suicide and put an end to her life, but when, as often happens, she was questioned, she accused her husband of setting fire to her clothes, not with a view to save herself from a conviction for attempting to commit suicide, but either on account of her feeling that her husband was responsible for all her troubles and that her disparate action was also due to the same cause or out of malice. Any way, a dying declaration is not to be believed merely because no possible reason 788 can be given for accusing the accused falsely. It, can only be believed if there are no grounds for doubting it at all. Apart from the above considerations indicating that implicit reliance cannot be placed on the dying declaration, there are other circumstances which add to the feeling of uncertainty about the truth of the accusation made in the dying declaration. The panchnama of the room shows that a few shirts and old trousers and pieces of two sarees lay near the southern wall of the room in a wet and half burnt condition There is no explanation why such clothes should have been burnt. There was no point in the accused pouring kerosene oil on these clothes even if they just lay huddled near the wall. If Sindhubai fell on the clothes lying there, that may burn some of them, but will not explain their getting wet. There is no suggestion that anybody had poured water over the 'burnt clothes in order to extinguish the fire, because none came there at all. In fact, Ranganath Sitaram, P.W. 6, one of the Panchs, states that the burnt clothes were also giving smell of rock oil. The panchnama further notes : "On the eastern wall, two feet height from the ground there is a black spot caused due to the burning of the clothes and the same is recent one. " There is no explanation why such a mark should be there. Sindhubai could not have stood opposite the wall and, even if she did, there should have been marks of burning along the length of her body beside the wall and not at a certain spot only. These two observations can be consistent only with somebody deliberately setting fire to the clothes and keeping some burning clothes beside the wall for a, little time, The appellant, or whoever 789 set fire to her clothes, would not have done this as he would have made a very quick exit after drenching Sindhubai with kerosene oil and setting fire to her clothes. Sindhubai does not make any statement about such a conductor the accused in her dying declaration. The only inference then possible is that she herself (lid all this, in accordance with her own inclinations. Why she did this, one cannot say. Sindhubai returned to her house with her daughter after taking her mid day meal at her mother 's house and sent back the daughter with Usha. This is according to the statement of her mother. She brought the child, when, according to her mother 's statement, she expected her husband to come to the house after taking his meal at his cousin 's place. The conduct is unusual, as, ordinarily, the child used to remain with her maternal grand mother during the day time, as for some reason the accused probably felt aversion to her. The conduct can 'be consistent with her intention to commit suicide. She brought the child to her place to fondle with her for the last time and then sent her back to her mother. Sindhubai 's running towards the house of Shantabai, her husband 's cousin, and not running towards her mother 's place, also appears to be unnatural. It may be that in such troubles moments one need not be absolutely logical, but it is expected to be instinctive that when in trouble one thinks of one 's relations who are expected to be sympathetic, and helpful, on the occasion. It is in the statement of her mother that the route to her house is different from the passage to the house of Shantabai. It may be that the accused did not go to the house as expected, and went away to his job from his cousin 's place. It was a day of festival. Sindhubai might have felt this conduct badly set fire to her clothes, and then run towards 790 Shantabai 's house where she might have expected her husband to be present. The time of the incident though said to be between 1 30 and 3 30 P.m., appears to have been near about 3 O ' clock. The mother states to have got information about that time. Tile police got information at about 3 45 P.m., and the ambulance took Sindhubai to the hospital at 4 15 P.M. The accused was not expected to be at his house at 3 P.m. The learned Judges of the High Court did not believe the defence evidence about the accused working at the house of Mulchand Rajmal from about 2 P.m. and to have gone to his house on receiving information from one Daga because Daga was. not examined, the Munim of the house owner was not examined and the register of workers was not produced. It is however the case for the prosecution that the accused used to go to work at 7 A.M., to return at 12 O 'clock and again go for work at 2 P.m., and then return at 6 P.m. Chandrabhaga, the mother of the deceased, deposes so. There is therefore no good reason 'to think that the accused did not go to his duty at 2 P.M., that day as deposed to by D.W. I. Sindhubai herself stated in her statement to the police that the accused, after setting her on fire, ran away to his work. If the time of the incident be calculated from the time the police was informed, i. e., from 3 45 P.m., the incident would have taken place some time between 3 and 3 30 P.m., and the accused would not have been at his house at that time. In fact, it appears to us that it is to avoid this difficulty that at Rome stage an attempt was made to time the incident at about 1 30 P.m. The incident could not have taken place before 2 P.m., as, in that case, information to the police would be very belated and in the normal course of events, it is not expected that Sindhubai would have tarried in the room for long or that the persons who must 791 have collected after her running towards Shantabai 's place and falling down there, Would not have taken steps to inform the police without any undue delay. The mother 's statement that Sindhubai used to tell her that if the ill treatment continued, she would sever her connection with the accused and would earn her own living would support the view that she had really got tried of her living with the accused and that this could have prompted her to attempt suicide. If Sindhubai was not actually asleep when the kerosene oil was poured on her, it does not stand to reason that she would not have made any attempt to run away and the possibility of the accused successfully setting fire to her clothes in the course of the struggle, would be remote, and even if he succeeded, it is a moot point whether he too would not have been singed, if not burnt. Those are the various considerations which make us feel doubtful about the truth of the dying declaration and take the view that the appellant 's conviction on the basis of the dying declaration should not be maintained. It appears from the High Court judgment that the case put before it was "sometime after 1.30 P.m., the accused latched the room from inside and while Sindhubai was sleeping he poured a large quantity of kerosene oil on her person. Her clothes became wet with that kerosene oil and before she could struggle and get up he searched for a match stick, lighted it and set Sindhu 's clothes on fire '. Such a case could not be made out from the dying declaration recorded by the Magistrate. Sindhubai had said at first she was sleeping when it happened, but, in answer to the very next question, she said that her husband beat her and then burnt her. If the burning followed the beating, there could be no question of throwing kerosene oil on 792 her while asleep. No reason for this conduct was stated. The, Magistrate who cleared the doubt full points failed to elicit why this deed was perpetrated. Further, the searching for a match box is very improbable thing. If the accused had decided to set fire to his wife, he would have got, a match box handy and if he did forget about it and had to search for it, that would give sufficient time to Sindhubai to make good her escape. The aversion of Sindhubai to tell the name of her husband could not have been on account of any tender feeling for her husband, but was the natural act of a Hindu married woman not to tell her husband 's name. This aversion to tell the name of her husband is no guarantee of the truth of her subsequent statement accusing her husband of the crime. We do not find any justification for the following observation of the High Court, when considering the defence evidence : "The accused has led evidence and his case is that he was not responsible for this murder at all. But in fact he was in the house when the incident took place. " The High Court had made the latter statement as a statement of fact, though there was no evidence to support it. Of course, on the basis of a dying declaration, the High Court had already held before discussing the defence evidence, that the accused was responsible for the murder of his wife. If the defence evidence is to be adjudged on the basis of the final finding of the Court, there is no use for defence evidence. It has to be taken into consideration before arriving at a final finding. The conduct of the accused in travelling in the same ambulance car and in remaining in the 793 hospital is in his favour and is against the prosecution. The accused stated in his examination that he paid the charges for the ambulance car. We would like to remark that the learned Judges who heard the appeal should not have heard it when they, at the, time of admitting it, felt so strongly about the accused being wrongly acquitted 'of the offence of murder that they asked the Government Pleader to look into the papers to find out whether it was a case where the Government would like to file an appeal against the acquittal, under section 302, I.P.C. Government did file an appeal against that acquittal. We do not know whether it was at the suggestion of the Government Pleader or not. But, in these circumstances, it would have beep better exercise of discretion if this appeal against the acquittal had not been heard by the same Bench which, in a way, suggested the filing of the Government appeal. In fact, to make such a suggestion, appears to be very abnormal. We are therefore of opinion that it is not satisfactorily proved that the appellant committed the murder of his wife by setting fire to her clothes. We would therefore allow the appeal. , set aside the order of the Court below and acquit the appellant of this offence. By COURT. In accordance with the opinion of the majority, this appeal fails and is dismissed.

The appellant was tried for an offence under section 302 Indian Penal Code for the murder of his wife. The evidence consisted mainly of the uncorroborated dying declaration of the wife. The Sessions judge accepted the evidence but convicted the appellant under section 304 Part 1 Indian Penal Code. On appeal by the State the High Court convicted the appellant of an offence under section 302 Indian Penal Code and sentenced him to death. The appellant contended that he had a right of appeal to the Supreme Court under article 134 (1) (a) of the Constitution and that his conviction was bad. Held, that the appellant had a right of appeal to the Supreme Court under article 134 (1) (a) of the Constitution. The conviction of the appellant under section 304 Part 1 of the Indian Penal Code by the Sessions judge amounted to an acquittal of the offence under section 302 and the High Court had reversed this order of acquittal and sentenced the appellant to death. The word "acquittal" in article 134 (1) (a) did not mean that the trial must have ended in a complete acquittal of the charge, but acquittal of the offence charged and conviction for a minor offence was included in the word "acquittal". Kishan Singh vs The King Emperor, (1928) L. R. 55, I.A. 390 relied on. Per Kapur, Subba Rao and Shah, JJ. The appellant was rightly convicted and sentenced by the High Court. it was legal to found a conviction on the uncorroborated dying declaration. The dying declarations had been accepted both by the Sessions judge and by the High Court and there was nothing in the evidence on the record which detracted from the findings of those courts in regard to the correctness or the propriety of this dying declaration. 776 Khushal Rao vs The State of Bombay, ; , referred to. Per Hidayatullah and Dayal, JJ. In an appeal under article 134 (1) (a) of ' the Constitution the Supreme Court assessed afresh the evidence on record and did not follow the practice in appeals by special Leave under article 136 that concurrent findings of the Courts below could be interfered with. only when special circumstances existed. In the circumstances of the present case it was not safe to rely on the dying declaration and the appellant was entitled to be acquitted.

Appeal No. 9 of 1952. Appeal from the Judgment and Order dated 2nd January, 1950, of the High Court of Judicature at Madras (Satyanarayana Rao and Viswanatha Sastri JJ.) in Case Referred No. 68 of 1946. M. C. Setalvad, Attorney General for India, (P. A. Mehta, with him) for the appellant. K. section Krishnaswami Aiyangar (M. Subbaraya Aiyar, with him) for the respondents. December 22. The Judgment of the Court was delivered by MAHAJAN J. This is an appeal from,the judgment of the High Court of Judicature at 'Madras in a reference made by the Income tax Appellate Tribunal under section 66 (1) of the Indian Income tax Act, XI of 1922. 488 For several years prior to 1939 40 the respondents, .who are. brothers, had been carrying on in partnership the business of " The Hindu," a daily newspaper of Madras. The profits of this business had been charged to income tax in the hands of the respondents under the Indian Income tax Act of 1918. The firm 's year of account was a period of twelve months ending with 30th June each year. In respect of the profits of the year of account ending 30th June, 1938, assessment was made in the year 1939 40 and the firm was charged to income tax for that assessment year. On 1st March, 1940, the respondents transferred their business as a going concern to a private limited company called " Kasturi and Co. Ltd." For the assessment year 1940 41 the respondents claimed that the firm was not liable to pay any income tax on the income of its business from the end of the accounting year ending 30th June, 1938, to 29th February, 1940, the date on which the limited company succeeded to the business of the firm (i.e., for a period of 20 months) under section 25 (4) of the Act, as it had been assessed under the Indian Incometax Act, 1918. The Income tax Officer disallowed the claim and held that since the assessment pertained to the year 1940 41 the previous year with reference to that assessment would be the year ending 30th June, 1939, and the period for which exemption could be claimed under section 25(4) of the Act was the interval from the end of that previous year, i.e., 1st July, 1939, upto to the date of succession, i.e., 29th February, 1940, i.e, a period of eight months. This order was confirmed on appeal by the Appellate Assistant Commissioner. On further appeal the Tribunal held that on a proper construction of section 25(4) of the Act, tax was not payable by the firm in respect of the profits and accounts of the business for the whole of the period from 1st July, 1938, to 29th February, 1940, (a period of 20 months). At the instance of the Commissioner of Income tax (the appellant) the Tribunal stated a case to the High Court and referred to it the following question for its opinion: 489 " Whether on the facts of this case, the Appellate Tribunal was right in holding that the period the profits of which were entitled to exemption from the payment of tax under section 25(4). of the Indian .Income tax Act, 1939, was the period commencing from 1st July, 1938, and ending. With 29th February, 1940. " The reference was heard by Satyanarayana Rao and Viswanatha Sastri JJ. and they delivered divergent opinions on the question referred. Satyanarayana Rao J. agreed with the conclusion of the Tribunal and answered the question in the affirmative, while Viswanatha Sastri J. answered the question in the negative, with the result that under the provisions of the law the Tribunal 's order was confirmed, it being in accordance with the opinion delivered by the senior Judge. Leave to appeal to this Court was granted and this appeal is before us on a certificate given by the High Court. The principal question to decide in this appeal is whether on a true construction of section 25(4) of the Act, and on the facts stated the period the profits of which were entitled to exemption from the payment of tax is the period between 1st July, 1939, to 29th February, 1940, (a period of eight months) or the period commencing from 1st July, 1938, and ending with 29th February, 1940 (a period of 20 months). To decide this question it is necessary to set out the relevant provisions of the Act. Section 2(11), which defines " previous year " in so far as it is relevant for purposes of this appeal is : " (11) (a) the twelve months ending on the 31st day of March next preceding the year for which the assessment is to be made, or, if the accounts of the assessee have been made up to a date within the said twelve months in respect of a year ending on any date other than the said 31st day of March, then at the option of the assessee the year ending on the day, to which his accounts have so been made up." 490 Section 3 of the Act provides: 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 charged 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 individual, 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. " This is the charging section. Section 25 of the Act makes different provisions to cover some special cases. The parts of the section relevant to this appeal pro vide as follows: (1)Where any business, profession or vocation to which sub section (3) is not applicable, is discontinued in any year, an assessment may be made in that year on the basis of the income, profits or gains of the period between the end of the previous year and the date of such discontinuance in addition to the assessment, if any, made on the basis of the income, profits or gains of the previous year. (3) Where any business, profession or vocation on which tax was at any time charged under the provisions of the Indian Income tax Act, 1918 (VII of 1918), is discontinued, then, unless there has been a succession by virtue of which the provisions of sub section (4) have been rendered applicable no tax shall be payable in respect of the income, profits and gains of the period between the end of the previous year and the date of such discontinuance, and the assessee may further claim that the income, profits and gains of the previous year shall be deemed to have been the income, profits and gains of the said period. Where any such claim is made, an assessment shall be made on the basis of the income, profits and gains of the said period, and if an amount of tax has already been paid in respect of the income, profits and gains of the previous year exceeding the amount payable on 491 the basis of such assessment, a refund shall be given of the difference. (4) Where the person who was at the commencement of the Indian Income tax (Amendment) Act, 1939 (VII of 1939), carrying on any business, profession or vocation on which tax was at any times charged under the provisions of the Indian Incometax Act, 1918, is succeeded in such capacity by another person, the change not being merely a change in the constitution of a partnership, no tax shall be payable by the first mentioned person in respect of the income, profits and gains of the period between the end of the previous year and the date of such succession, and such person may further claim that the income, profits and gains of the previous year shall be deemed to have been the income, profits and gains of the said period. Where any such claim is made, an assessment shall be made on the basis of the income, profits and gains of the said period, and, if an amount of tax has already been paid in respect of the income, profits and gains of the previous year exceeding the amount payable on the basis of such assessment, a refund shall be given of the difference. (6) Where an assessment is to be made under subsection (1), sub section (3), or sub section (4) the Income tax Officer may serve on the person whose income, profits and gains are to be assessed, or, in the case of a firm, on any person who was a member of such firm at the time of its discontinuance, 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 the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section. " For a proper construction of section 25 it is also necessary to set out the history and object of this enactment. Under the Act of 1918 income tax was levied on the income of the current year, i.e., the year of 492 assessment but as the income of that year could not be known till after the expiry of the year, the assessment was made on the basis of the income of the " previous year" but after the close of the assessment year an ,adjustment used to be made on the basis of the income of the assessment year. The Act of 1922 introduced a change in this respect. Under section 3 of the Act, 'the income of the previous year is made the subject of the charge and tax is levied on the income of the previous year though it is a tax for the assessment year. On the passing of the Act of 1922, the previous system of assessment was kept alive for one year. The result was that for the year 1922 23, there were two assessments, one under the Act of 1922 on the income of 1921 22 and another under the old system byway of assessment on the income of the same year 1921 22. In other words, the income of the year 1921 22 was assessed twice, once under the Act of 1918, and again under the Act of 1922. To remove this anomaly and in order to make the number of assessments tally with the number of years during which the business existed, section 25(3) of the Act of 1922 was enacted exempting from tax the profits for the period between the end of the previous year and the date of discontinuance in the case of a business whose profits had been assessed to tax under the Act of 1918. There was no provision in section 25 as enacted in 1922 for giving any relief in cases of succession to a business which was taxed under the Act of 1918. In 1939 a provision was made to extend similar relief to cases of succession and with this object section 26(2) of the Act was amended and section 25(4) was added by the amending Act of 1939. The result of the amendment of section 26(2) and the insertion of section 25(4) is that upon a transfer of business the transferor, i.e., the person who was succeeded in the business, would get the same relief as if the business had been discontinued by him. The scheme of the Act is that by the charging section, i.e., section 3, income tax is levied for a financial year at the rate prescribed by the annual Finance Act 493 on the total income of the previous year of every in dividual, etc. Each previous year 's income is the, subject of separate assessment in the relative assessment year. Though the year of assessment is the financial year, the previous year of an assessee need not necessarily be the previous financial year, for this expression is to be understood as defined by section# 2(11) (a) of the Act. The respondents were duly assessed to tax for the year of assessment, i.e. the financial year 1939 40, on the income of the previous year ending on 30th June, 1938. Their income of the accounting year ending 30th June, 1939, would in the ordinary course be liable to assessment in the financial year 1940 41, and the profits of the year ending 30th June, 1940, would be assessable in the financial year 1941 42. Succession took place in the accounting year 1939 40. Under sub section (2) of section 26, as it stood before its amendment in 1939, the person succeeding to a business was liable to tax for the year of succession, as if he had been carrying on business throughout that year and had received the profits of the whole of that year. Thus Kasturi and Company Limited would have been liable to be assessed on the profits earned during the year ending 30th June, 1940, irrespective of the fact that actually they would have only received profits in that year for a period of four months. After the amendment in 1939 sub section (2) of section 26 provides that the person succeeded and the person succeeding " each be assessed in respect of his actual share, if any, of the income, profits and gains of that year. " Thus the profits of the year in which the succession occurs are to be apportioned between the predecessor and the successor according to the actual share of each in the year 's profits, the predecessor and the successor are each liable to tax at the rate applicable to each and the profits of each have to be computed separately in accordance with the provisions of section 10 and other sections and each has to be granted the deductions and allowances appropriate to his case, and 494 assessment on each has to be separate and distinct. If the business was charged under the Indian Incometax Act, 1918, and the person succeeded is exempt from tax under section 25 (4) he would not charged in respect of the profits of the period from the end of the previous year up to the date of succession, while the person succeeding would be liable under sub section (2) of section 26 in respect of the profits earned by him after the date of succession. The proviso to sub section (2) lays down two exceptions to the general rule that the successor is not liable to tax in respect of the profits of the period prior to the date of succession. In two cages, namely, (1) when the predecessor cannot be found, or (2) when the tax assessed on the predecessor cannot be recovered from him, the successor is liable to pay the tax in respect of the profits of the year in which the succession took place up to the date of succession as well and further for the profits earned during the year preceding that year. In this case if either of those contingencies arose, Kasturi and Company Limited would have been liable to pay tax on profits of the whole accounting year ending 30th June, 1939, as well as of the whole of the accounting year ending 30th June, 1940, and end of the preceding year in this context would be 30th June, 1939. It is a question whether in this situation they would be entitled to the relief provided in section 25(4). On behalf of the Commissioner of Income tax, Madras, the learned Attorney General contended that Satyanarayana Rao J. was in error in granting exemption to the firm from tax in respect of the profits earned during a period of 20 months and that under section 25, sub section (4), the only relief permissible was in respect of profits earned during the period of 8 months from 1st July, 1939, to 1st March, 1940. It was said that the profits of the year of succession were liable to assessment in the usual course in the financial year 1941 42 and the Income tax Officer had no power to make an accelerated assessment in order to give relief to the persons succeeded in the business 495 and that being so, it was not right to hold that the expression " previous year" in section 25, sub section (4), was co related to the assessment year 1939 40, i.e the year in which,the succession took place or to the assessment year 1941 42 in which in the ordinary course assessment for those profits would have been made but that on a true construction of this sub section and having regard to the history of its enactment and the object for which it was inserted in section 25, the assessee firm was entitled to exemption from the payment of tax, only for the period between 1st July, 1939, and 29th February, 1940, and to no more. It seems to us that there is force in this contention, Section 25 (4) was inserted in the Act of 1922 in the year 1939 at the same time as section 26(2) was amended. On a plain reading of these two sections together, it is quite clear that the Income tax Officer is not empowered to make an accelerated assessment in the year in which succession occurs on the ' profits of that year, and prematurely assess the person succeeding to a business so that he may able to give ' relief to the person succeeded. The exemption provided for its section 25 (4) and the apportionment mentioned in section 26 (2) have to be made in the assessment year in which the profits of the year of succession fall to be assessed under sections of the Act, and in this situation the end of the 'previous year in this case can, in no circumstance, be the end of the accounting year beginning 1st of July, 1937, and ending 30th of June, 1938, because the income, profits and gains of the accounting year of succession (i.e., year beginning 1st July, 1939, and ending 30th June, 1940) which have to be apportioned between the predecessor and successor of the business under section 26(2) and for which the successor becomes liable in case the predecessor commits a default, could only be assessed in the assessment year 1941 42. The income, ' profits and gains of the accounting year beginning 1st July, 1938, and ending 30th June, 1939, for which the predecessor alone is liable in the first instance to 496 tax fall for assessment in the assessment year 1940 41. The successor in business, in case of default by the predecessor, is also liable to pay the tax on the profits of that year as well. What subjection (4) of section 25 provides is that when the profits of the year of succession fall to be assessed, the predecessor of a business can claim exemption from liability to pay tax on the profit earned from the end of the previous year to the date of succession, the "Previous year" here meaning the completed accounting year immediately preceding the date of succession (in this case year ending 30th June, 1939). He can further claim that the profits earned between 1st July, 1939, to 29th February, 1940, be deemed the profits of the accounting year 1st July, 1938, to 30th June, 1939, and if on those profits in assessment year 1940 41 tax in excess of what is chargeable on the profits of this broken period has been paid, be given refund for the excess. Truly speaking, the firm was entitled to the relief provided for in section 25(4) in the assessment year 1941 42 but the Income tax Officer was prepared to give him that in the assessment year 1940 41,and on that score the assessee can have no grievance. Satyanarayana Rao J. held that the words " previous year " in sub . section (1) of section 25 refer to the year of account relevant to the year of assessment in which the discontinuance occurs, that the section authorises the Income tax Officer to make a cumulative assessment in respect of the profits of the period between the end of the last accounting year of which the profits have been assessed before the date of discontinuance and that date, that " sub section (3) of section 25 is an exception to the general rule contained in sub section (1) of that section, and that, though the language employed in sub section (3) does not correspond to the language employed in sub section (1) indicating that in this Sub section also the assessment year should be taken to be the year in which the discontinuance occurs, all the same there is no reason 497 to depart and to place a different interpretation on the expression 'previous year ' in this sub section$ from the one placed on sub section (1). " On the same line of reasoning the learned Judge gave the same meaning to the expression " previous year " in subsection (4) of section 25 and as a result held that the firm was 'entitled to exemption from tax for profits earned between the 1st July, 1938, and 29th February, 1940, a period of 20 months. Mr. Krishnaswami Aiyangar appearing for the respondents, was not prepared to support the whole of the reasoning of Satyanarayana Rao J. but he contended strenuously that the conclusion reached by the learned Judge was the only one that could be reached on a true construction of the phraseology employed in the various sub sections of section 25. In short, his argument was that sub section (1) of section 25 confers an option on the Income tax Officer, in case of discontinuance of a business which was not assessed under the Act of 1918, to make an accelerated assessment in the year of discontinuance itself on the income, profits and gains earned up to the period of discontinuance and not assessed before in any preceding assessment year; that the expression " previous year" in the context of this sub sec tion means the end of the accounting year the profits of which have been last assessed to tax, which in this case means the year ending 30 th June, 1938. It was further contended that any other meaning given to these words would create a hiatus and would lead to the result that on the date of discontinuance the Income tax Officer would be entitled to assess the profits of the broken period without being entitled to assess the profits of a whole previous year that had expired, the profits of which in the usual course could not be assessed in the year of discontinuance and that such a construction would defeat the very purpose of the power given by the sub section. On a parity of reasoning it was suggested that the words "between the end of the previous year and the date of such discontinuance" in subsections (3) and (4) 498 should be given the same meaning as in sub section (1), and that the assessee should be given exemption in respect of profits earned between the 1st July, 1938, and 29th February, 1940. It was said that the two terminals fixed for the purposes of assessment under section 25(1) were the terminals fixed for exemption from tax in section 25(3) and (4) and it would be wrong to hold that the assessment under section 25(1) could be made for a period different from that for which relief could be given under section 25 (3) and (4). It was urged that the scope of the charge authorised by section 25 (1) was co extensive with the extent of the relief provided for in subsections (3) and (4). Before proceeding further it is convenient to make a few observations regarding the proposition stated by Satyanarayaua Rao J. that section 25 (1) provides for cumulative assessment in cases of discontinuance of business. The words of the section do not justify this conclusion. They do not empower the Incometax Officer to make a cumulative assessment in respect of profits earned in two different accounting periods or entitle him to merge the profits of two years into one total sum and apply to them the rate of one of the financial years. All that the section authorises the Income tax Officer to do is that it gives him an option to make a premature assessment on the profits earned up to the date of discontinuance in the year of discontinuance itself instead of in the usual financial year. This assessment he is entitled to make in addition to the normal assessment for the financial year of discontinuance. Mr. Aiyangar very rightly conceded that the construction placed on subsection(1) of section 25 by the learned Judge in this respect was not right. As regards the main contention of Mr. Aiyangar based on the analogy of the language employed in sub section (1) of section 25, we are of the opinion that this contention is based on a fallacy and cannot be sustained. As above pointed out, sub section (1) of section 25 merely empowers the Income tax Officer, 499 if he so chooses to do, to make an accelerated assessment in case of discontinuance of business at the time of discontinuance to save loss of revenue by the disappearance of an assessee. In other words, the subsection imposes a liability of premature assessment on the assessee. It confers no benefit on him. Sub sections (3) and (4) of section 25 have a different end in ' view and are not in pari materia with sub section (1). They are in the nature of substantive provisions intended to give relief from tax charged in certain cases. The mere circumstance of their being grouped together with sub section (1) in section 25 cannot lead to the conclusion that the provisions therein contained are of the same nature and character as the provi sions contained in sub section (1). Satyanarayana Rao J. was clearly in error when he held these two subsections were in the nature of exceptions to the rule laid down in sub section(1). The truth of the matter is that it is sub section(1) itself which is an exception to the general rule laid down in the charging section of the Act, namely, section 3. The object of sub sections (3) and (4) is to provide relief to a business for the double assessment suffered by it in the financial year 1922 23 and it is entitled to this relief in the year of assessment in which the income and profits of the accounting period in which discontinuance or succession takes place fall to be assessed. The Income tax Officer is not authorised to accelerate the relief by making a premature assessment on these profits. Not only is the language of these two sub sections different from the language of sub section (1), but they deal with two different categories of assessees. Sub 'section (1) deals with a category of assessees who were never subjected to double tax, while sub sections (3) and (4) deal with that class who suffered assessment under the Act of 191.8 and paid double tax. The liability for premature assessment imposed under section 25 (1) on the former class of assessees has feed imposed on considerations entirely different from those on which provision has been made for exemption to tax in sub sections 65 500 (3) and (4) for the other class. In, these circumstances, such relief cannot be said to be co extensive with the liability imposed. Moreover, the provisions of the Income tax Act in respect to exemptions and deductions cannot be construed on the 'analogy of the provisions contained in the charging sections of the Act even if the language of these provisions is similar. Mr. Aiyangar 's contention that sub section (1) crystallizes the rights of the assessee on the date of discontinuance and that not only does it relieve him from being taxed after the date of discontinuance, but that it entitles him to further relief provided for in sub section (3) does not seem to be well founded. Sub section (1) of section 25 confers no right of any kind on an assessee which can crystallize on the date of discontinuance and which cannot be varied subsequently to his disadvantage. On the other hand, as already said it imposes a premature burden on the assessee which but for this sub section he could not be called upon to bear till the appropriate year of assessment was reached. The learned Attorney General was not prepared to accept the construction placed on Sub section (1) of section 25 by Mr. Aiyangar and contended that sub section did not authorise the Income tax Officer to make an assessment in the year of discontinuance on the profits of an accounting year which had come to a close before the date of discontinuance, and that those profits had to be assessed in the usual way in the appropriate financial year, and that authority given to make an accelerated assessment only related to the broken period beginning with the end of the completed accounting year immediately preceding the date of discontinuance and ending with the date of discontinuance. In our opinion, it is not necessary for the purposes of deciding this case to finally express an opinion as to the true meaning of the words " between the end of the previous year to the date of discontinuance " used in section 25 (1) of the Act. After a careful consideration of the different provisions of the Act relevant to this enquiry, we have 501 reached the conclusion that the expression "end of the previous year " in sub sections (3) and (4) of section 25 in the context of those sub sections means the end of an accounting year (a period of full 12 months) expiring immediately preceding the date of discontinuance or succession, (in this case 30th. June, 1939). We are satisfied that Viswanatha Sastri J.". was right when he held that having regard to the object of the legislature in enacting sub sections (3) and (4) of section 25 and having regard to the plain language of these sub sections, the assessee 's contentions could not be upheld. We are, however, unable to subscribe to the conclusion reached by the learned Judge that the expression " previous year " in subsections (3) and (4) of section 25 was co related to the year of assessment 1940 41. The profits of the year of discontinuance could not, according to the scheme of the Act, be taxed till the financial year 1941 42 and the previous year co related to that assessment year would be the accounting year ending 30th June, 1940. It is obvious that the 'end of the accounting year falling after the date of discontinuance could not appositely be said to be the end of the previous year preceding that date. The expression ((previous year" substantially means an accounting year comprised of a full period of twelve months and usually corresponding to a financial year preceding the financial year of assessment. It also means an accounting year comprised of a full period of twelve months adopted by the assessee for maintaining his accounts but different from the financial year and preceding a financial year. For purposes of the charging sections of the Act unless otherwise provided for it is co related to a year of assessment immediately following it, but it is not necessarily wedded to an assessment year in all cases and it cannot be said that the expression "previous year" has no meaning unless it is used in relation to a financial year. In a certain context it may well mean a completed accounting year immediately preceding the happening of a contingency. The construction we have placed on 502 this expression in sub sections (3) and (4) of section 25 is in accord with the substance of the definition given in section 2 (1 1) of the Act. Any other construction of the section is bound to lead to a number of anomalies, the most glaring being that in case of persons whose year of account is the financial year, exemption from tax under section 25 (3) or (4) could never be given for a period of more than twelve months, while in case of persons who adopt different accounting year, exemption would become available for a period extending up to 24 months. Such could never have been the intention of the framers of the Act. That the "previous year" in the context of section 25(3) and (4) means a completed accounting year immediately preceding the discontinuance or succession is borne out by the provisions as regards nonliability for tax for the broken period and the 'claim to be made by the assessee that the income, profits and gains of the previous year shall be deemed to have been the income, profits or gains of the broken period. The intention of the legislature being to give relief against double assessment for the year 1922 23, the assessee in the case of discontinuance or succession would be entitled to claim exemption from payment of tax for the broken period and also claim that the income, profits or gains of the previous year, i.e.) the year preceding the broken period, should be treated as the income, profits or gains of the broken period. Reference was made in the judgment of the Appellate Tribunal to the views of the Select Committee when clause (1) of section 25 was considered at the time of the draft Bill No. XXVI of 1921 in support of its conclusion, but it was rightly held by the High Court that it was not a permissible consideration in interpreting a statute and Mr. Aiyangar did not seriously press this matter before us. He, however, drew our attention to the directions contained in the Income tax Manual in force for a number of years and contended that the department itself placed on sub sections (3) and (4) of section 25 the same construction as was 503 placed on them by the senior Judge in the High Court and that was the true construction of these two sub sections. This argument, in our opinion, has no ' validity. The department changed its view subsequently and amended the manual. The interpretation placed by the department on these sub sections cannot be considered to be a proper guide in a matter like this when the construction of a statute is involved. The result is that we allow the appeal and hold that the answer given by the senior Judge to the question referred was wrong and that the answer given by Viswanatha Sastri J. was the correct one. In the circumstances of this case we would make no order as to costs throughout. Appeal allowed. Agent for the respondent : M. section K. Aiyangar.

Two brothers who had been carrying on in partnership a business, which had been assessed to income tax under the Indian Income tax Act of 1918 and the accounting year of which was a period of 12 months ending on the 30th June each year, transferred the business to a limited company on the 1st March, 1940, and claimed in the assessment for the year 1940 41 that under section 25 (4) of the Income tax Act, 1922, they were not liable to pay income tax on the income of their business from 1st July, 1938, up to 29th February, 1940, a period of 20 months. The Income tax authorities were of the view that exemption could be claimed only 487 for the period from 1st July, 1939, to 29th February, 1940, a period of 8 months: Held, that the expression "end of the previous year" in sub sections (3) and (4) of section 25 in the context of those sub sections means the end of the accounting year (a period of full 12 months) expiring immediately preceding the date of discontinuance or succession and the assessee firm was entitled to claim exemption from tax only in respect of the period from the 1st July, 1939, to the 29th 'February,1940, On a true construction of sections 25 and 26, the Income tax Officer is not empowered to make an accelerated assessment in the year in which succession occurs on the profits of that year and prematurely assess the successor so that he , may be able to give relief to the person succeeded. The exemption provided for in section 25 (4) and the apportionment mentioned in section 26 (2) have to be made in the assessment year in which the profits of the year of succession fall to be assessed under section 3 of the Act. For the purposes of the charging sections of the Act the ex pression "previous year" is co related to a year of assessment immediately following it, but it is not necessarily wedded to an assessment year in all cases and it cannot be said that the expression "previous year" has no meaning unless it is used in relation to a financial year. In a certain context it may well mean a completed accounting year immediately preceding the happening of a contingency.

Appeal No. 278 of 1959. Appeal by special leave from the judgment and order dated April 2, 1957, of the Punjab High Court, in Civil Revision No. 239 of 1956. C. K. Daphtary, Solicitor General of India, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant. section T. Desai and Naunit Lal, for the respondents. May 2. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. The appellant Dr. Gopal Das Varma owns a double storeyed house known as 28, Barakhamba Road, New Delhi. The ground floor of this house consists of a block of offices and the first floor consists of four flats; three of these are in the occupation of the appellant while the fourth has been let out to respondent 1, Dr. Bhardwaj. Dr. Bhardwaj is an ear, nose, throat specialist, and in one of the four rooms of the flat be and his wife, respondent 2, reside, while the, three other rooms are used by him for the purpose of his profession. Respondent 1 ap. pears to have taken the premises on lease as early as 1934 although he executed an agreement of tenancy in favour of the appellant on November 8, 1935. This agreement shows that the appellant agreed to let out his flat to respondent 1 on a rent of Rs. 90 per month payable in advance. The tenancy was to commence from October 1, 1935, and was intended to continue up to _September 30, 1936. Parties agreed that the said 680 tenancy could be renewed on terms to be settled later. In fact the tenancy has been renewed from year to year and the flat is still in possession of respondent 1. In October 1953 the appellant sued the two respondents for ejectment on two grounds. He alleged that he required the premises in question for occupation as residence for himself and for the members of his family and that respondent 1 had recently built a suitable residence for himself in Golf Link Area, New Delhi. The first plea was made under section 13(1)(e) of the Delhi and Ajmer Rent Control Act, 1952 (Act XXXVIII of 1952) (hereafter called the Act), while the second was raised by reference to section 13(1)(h) of the Act. According to the appellant, since both the requirements of the Act were satisfied he was entitled to obtain a decree for ejectment against the respondents. The claim thus made by the appellant was denied by the respondents. Respondent 2 pleaded that she was not the tenant of the appellant and she alleged that it was she and not respondent 1 who had built the house in Golf Link Area. Respondent 1 admitted that he was a tenant under the appellant. He, however, contended that the appellant did not require the premises bona fide for his personal use, and he urged that he was using the premises for carrying on his medical profession and as such the appellant was not entitled to eject him. He supported his wife in her plea that the house built in Golf Link Area belonged to her and not to him. On these pleadings the learned trial judge framed appropriate issues. He found that respondent 1 alone was the tenant of the appellant and that the premises in question had been let to respondent 1 for residential purpose. According to the trial judge the premises in suit had been constructed for residential purposes and the flat in question was let out to respondent exclusively for that very purpose. The trial judge further held that the fact that a portion of the premises was used by respondent 1 for his profession or business would not make the tenancy one for nonresidential purposes. In that view he rejected the 681 argument raised by respondent 1 on the explanation to section 13(1)(e) of the Act. The trial judge also held that it was respondent 1 who had built a house in Golf Link Area and since the said house was suitable for his residence the requirements of section 13(1)(h) were satisfied. On the question about the bona fide requirements of personal residence pleaded by the appellant under section 13(1)(e) the trial court made a finding against him. Even so, as a result of his conclusion under section 13(1)(h) the trial judge passed a decree for ejectment in favour of the appellant. Both the respondents challenged this decree by preferring an appeal before the Senior Sub Judge at Delhi. The appellate Court held that on the facts proved in the case it cannot be inferred that the premises in suit were built for residential purposes alone, and that evidence did not show that the premises in question had been lot to respondent 1 for residence alone. The appellate judge examined the conduct of the parties and held that it was proved beyond any shadow of doubt that respondent 1 was using the premises both for his residence and his professional work since the inception of the tenancy without any objection on behalf of the appellant, and so in his opinion the premises could not be said to have been let for residence alone. He also found that under the proviso to section 13(1)(e) it cannot be said that the premises were used incidentally for profession without the consent of the appellant; in that view section 13(1)(e) did not apply to the case. Since the appellant had failed to prove that the premises were residential premises within the meaning of section 13(1)(e) and (h) the appellate Court held that respondent 1 could not be ejected. In the result the appeal preferred by the respondents was allowed and the decree for ejectment passed by the. trial Court against them was set aside. The appellant then took the dispute before the High Court of Punjab by his revisional application. The High Court has in substance agreed with the view taken by the appellate Court, confirmed its main findings and has dismissed the revisional application. The High Court has observed that in its opinion the 682 appellate judge was fully justified in holding that the premises were let out to the tenant for the purpose of residence and for the purpose of his work as a member of the medical profession. It has made an alternative finding that even if it was assumed that the premises were let out to respondent 1 for the purpose of residence the plea of bona fide requirement made by the appellant was not proved and the argument based upon section 13(1)(h) was not available to the appellant because the Golf Link building which respondent 1 had acquired cannot be said to be suitable for the conduct of business if the neighborhood or the locality in which it is situated is not suitable for that purpose. In the result the High Court dismissed the appellant 's revisional application It is against this decision that the appellant has come to this Court by special leave. It is relevant to refer to the material provisions of the Act before dealing with the points raised for the appellant by the learned Solicitor General in the present appeal. The Act applies to premises which are defined by section 2(g) as meaning, inter alia, any building or part of a building which is, or is intended to be, let separately for use as a residence or for commercial use or for any other purpose. Section 13(1) provides that notwithstanding anything to the contrary contained in any other law or any contract, no decree or order for the recovery of possession of any promises shall be passed by any Court in favour of the landlord against any tenant including tenant whose tenancy is terminated. This provision is, however, subject to the exceptions provided under the several clauses of the proviso. We are concerned with two of these. Section 13(1)(c) allows a decree for ejectment to be passed if the Court is satisfied that the premises let for residential purposes are required bona fide by the landlord who is the owner of such premises for occupation as a residence for himself or his family and that he has no other suitable accommodation. The explanation to this clause provides that for the purpose of this clause residential premises include any premises which having been let for use as a residence are, without the 683 consent of the landlord, used incidentally for commercial or other purposes; and section 13(1)(h) provides for ejectment in a case where the Court is satisfied that the tenant has whether before or after the commencement of this Act built, acquired vacant possession of, or has been allotted, a suitable residence. It is with these three provisions that we are concerned in the present appeal. It would be noticed that as soon as it is found that the premises in question have been used by respondent 1 incidentally for professional purposes and it is further established that this use is made with the consent of the landlord then the case goes outside the purview of section 13(1)(e) altogether. In the present case it has been found by the appellate Court and the High Court that right from the commencement of the tenancy a substantial part of the premises is used by respondent 1 for his professional purpose, and they have also found that this has been done obviously with the consent of the landlord. It is unnecessary to refer to the evidence on which this finding is based. Even the trial Court was apparently inclined to take the same view about this evidence but it did not fully appreciate the effect of the explanation; otherwise it would have realised that the professional use of a substantial part of the premises with the consent of the appellant clearly takes the case outside section 13(1)(e). In other words, where premises are let for residential purposes and it is shown that they are used by the tenant incidentally for commercial, professional or other purposes with the consent of the landlord the landlord would not be entitled to eject the tenant even if he proves that he needs the premises bona fide for his personal use because the premises have by their user ceased to be premises let for residential purposes alone. This position cannot be seriously disputed. Faced with this difficulty the learned Solicitor General attempted to argue that the very finding made by the Courts below about the nature of the tenancy takes the premises outside the purview of section 2(g) of the Act. The argument is that the premises cannot 684 then be said to have been let for use as a residence or for a commercial use and so they ceased to be premises under the Act. It is suggested that any other use which is specified by section 2(g) would not include a combination of residence with commercial or professional purposes. The other use there referred to may be use for charity or something of that kind which is different from use as residence or commercial use. In our opinion this argument is not well founded. The three kinds of user to which the definition refers are residence, commerce and any other purpose which necessarily must include residence and commerce combined. It may also include other purposes as suggested by the learned Solicitor General. As soon as it is shown that the premises have been let both for the use of residence and for commercial purposes it does not follow that the premises cease to be premises under section 2(g); they continue to be premises under the last clause of section 2(g). This position is wholly consistent with the division of the premises made with reference to their user in paragraphs 3, 4 and 5 of Part A in the Second Schedule to the Act. Therefore, in our opinion, the argument urged by the learned Solicitor General on the construction of section 2(g) cannot be sustained. It will be recalled that the present suit has been filed by the appellant himself praying for the respondent 's ejectment under the provisions of the Act, and so the argument that the Act does not apply to the premises in question can be justly characterised as an argument of desperation. Then it is contended that even if the appellant may not be entitled to claim ejectment under section 13(1)(e) he would be justified in claiming a decree for ejectment against the respondent independently under section 13(1)(h). It is urged that as soon as it is shown that respondent 1 has acquired a suitable residence he can be ejected even though section 13(1)(e) may not apply to his tenancy. In our opinion, even this argument is fallacious. Section 13(1)(h) applies to tenancies which are created for essential purposes, and it provides that in the case of such tenancies even if the landlord may not be able to prove his case under section 13(1)(e) he would nevertheless be entitled to eject the tenant once it is shown 685 that the tenant has acquired another suitable residence. The requirement is that the tenant must have suitable residence. Both words of the requirement are significant; what he has acquired must be residence, that is to say the premises which can be used for residence and the said premises must be suitable for that purpose. If the promises from which ejectment is sought are used not only for residence but ' also for profession how could section 13(1)(h) come into operation? One of the purposes for which the tenancy is acquired is professional use, and that cannot be satisfied by the acquisition of premises which are suitable for residence alone, and it is the suitability for residence alone, which is postulated by section 13(1)(h). Therefore, in our opinion, it would be unreasonable to hold that tenancy which has been created or used both for residence and profession can be successfully terminated merely by showing that the tenant has acquired a suitable residence. That is the view taken by the High Court and we see no reason to differ from the conclusion of the High Court. The last argument urged by the learned Solicitor General is that respondent 1 should not be allowed to approbate and reprobate as he has done in the present case. This argument is based on the conduct of the respondent at the previous stages of the dispute. It is true that in 1941 and onwards respondent 1 has successfully urged that the tenancy was for residence, and in consequence has secured the extension of tenancy under cl. 11A of the New Delhi House Rent Control Order, 1939, issued under r. 81(2)(bb) of the Defence of India Rules. The statements made by respondent 1 in that behalf indicate that he exercised his option of obtaining extension of the lease on the ground that the premises were let out to him for residence. The argument is that since by the said representations he had actually obtained an advantage he cannot be permitted now to contend that the lease is not only for residence. On the other hand the conduct of the appellant himself is also inconsistent with the stand taken by 87 686 him in the present proceedings. In 1942 when he demanded an increased rent from respondent 1 he made out a case which is inconsistent with his present story that the premises were let out to respondent 1 only for residence. The case then made out by him appears to be that the tenancy fell under paragraph 4 of Part A in the Second Schedule to the Act, and that would mean that the premises had not been let only for residence. Indeed the conduct of both the parties has been actuated solely by considerations of expediency and self interest in this case, and so it would prima facie be idle for the appellant to contend that respondent 1 should not be allowed to approbate and reprobate. But, apart from this fact, it is obvious that the appellant cannot be allowed to raise this contention for the first time before this Court. The plea sought to be raised can be decided only after relevant evidence is adduced by the parties, and since this plea has not been raised by the appellant at the proper stage respondent 1 has had no opportunity to meet the plea and that itself precludes the appellant from contending that though the lease may not be one for residence alone respondent 1 should not be permitted to urge that it is not for residence but for residence and profession, It is the settled, practice of this Court that new pleas of this kind which need further evidence are not allowed to be raised in appeals under article 136 of the Constitution. The result is the appeal fails, but in the circumstances of this case we direct that the parties bear their own costs throughout. Appeal dismissed.

The respondent as a tenant of tile appellant was occupying a portion of the premises in question for residence and the other major portion for his professional work as an ear, nose, throat specialist. The appellant sued for the ejectment of the respondent on the grounds that (i) he required the premises for his own residence and that (ii) the respondent had built a suitable residence for himself in another locality. The first plea was based on the ground mentioned in section 133(1)(e) and the second plea on section 13(1)(h) of the Delhi and Ajmer Rent Control Act, 1952. The trial court decreed the suit but the appellate court and the High Court dismissed it on the finding that from the beginning of the tenancy a substantial part of the premises was used by the respondent for his professional work obviously with the consent of the appellant. Held, that premises let for residential purposes but used by 679 the tenant with the consent of the landlord incidentally for commercial, professional or other purposes cease to be premises let for a residential purpose alone and as such the landlord would not be entitled to eject the tenant under section 13(1)(e) of the Act. Nor can such a tenant be ejected independently under section 13(1)(h) because a tenancy created or used both for residence and profession cannot be terminated merely by showing that the tenant had acquired a suitable residence. Premises let both for residence and commercial purposes do not cease to be premises under section 2(g) and continue to be so under the last clause of section 2(g).

Appeal No. 457/58. Appeal from the Judgment and order dated September 12, 1956, of the Punjab High Court in Letters Patent Appeal No. 38 of 1955. N. C. Chatterjee and Naunit Lal, for the appellants. Nanak Chand, for the respondents Nos. 4 to 9. 1961. May 4. The Judgment of the Court was delivered by MUDHOLKAR, J. In this appeal under article 133 (1) (c) of the Constitution the question which arises for consideration is whether after July 22, 1952 the Custodian of ' Evacuee Property in the State of Punjab of the Custodian General hearing an appeal from an order made by the Custodian after July 22, 1952 has the power to cancel an allotment of rural evacuee property on a quasi permanent basis except upon the grounds set out in r. 14 (6) of the Administration of Evacuee Property Rules, 1950 as amended by notification No. section R. 0. 1290 dated July 22, 1952. The circumstances under which this question arises may now be briefly stated. The appellants and their father Nand Singh were displaced persons from West Pakistan and got allotment of some land in the village Raikot, District Ludhiana on a temporary basis. Later, each of the appellants 1 to 3 was allotted 8 1/3 standard acres of land on a quasi permanent basis while Nail(] Singh, their father who was entitled to 41 standard acres and 7 units and to whom land to that extent had been temporarily allotted in the 740 village Raikot was allotted the same acreage of land in the village Hambran which is situate at a distance of 25 or 30 miles from Raikot. Nand Singh made an application for revising the order under which this was done but he died in the year 1951, during the pendency of that application. The appellants as his legal representatives continued the application. That application was rejected and revision application made against the order passed thereunder was also rejected on the ground that after July 22, 1952 the Additional Custodian was not competent to cancel an allotment made in favour of any person except upon the grounds set out in r. 14 (6) of the Evacuee Property Rules. Respondents 4 to 9 owned lands in Chak No. 127, G. B. Jaranwala, District Lyallpur and are also displaced persons. They were, therefore, allotted certain lands in the village Karodian as quasi permanent allottees. Subsequently some revenue papers were received from Pakistan from which it appeared that they were entitled to urban allotment. They, therefore, brought this matter before the Deputy Commissioner exercising the powers of Deputy Custodian. Thereupon he cancelled the allotment in their favour sometime in the year 1952 and proposed to the Additional Custodian, who was also acting as Director of Relief and Rehabilitation, for the allotment of the lands which were originally allotted to the respondents to others. Appellant No. 2, Gopal Singh, on behalf of his father Nand Singh applied to the Director of Relief and Rehabilitation that the allotment in the name of his father Nand Singh might be shifted from the village Hambran ' to the village Karodian. Additional Custodian not only allowed the Application of Gopal Singh and shifted the allotment of Nand Singh to the village Karodian but he also shifted the entire allotment of the appellants Nos. 1 to 3 from the village Raikot to the village Karodian with 741 the result that the lands allotted to the family were consolidated in the same village. The appellants thereupon obtained possession of the Karodian lands. Respondents 4 to 9 were allotted urban lands, which according to the appellants are more valuable and are of a superior quality. They did not prefer an application for review of the order of cancellation of their earlier allotment or of the order passed by the Additional Custodian allotting their lands to the appellants. Six months later, however, respondents 4 to 9 preferred an application before the Additional Custodian stating therein that the land abandoned by them in West Pakistan was rural and that their allotment should be shifted back to the village Karodian. To this application they did not make the appellants parties. The Additional Custodian held that he could not cancel the allotment in favour of the appellants in view of r. 14(6) of the Evacuee Property Rules already referred to. He, however, recommended the case to the Custodian General of India by his memo, dated October 14, 1953, for taking appropriate action. The Deputy Custodian General who heard the case sent it back to the Additional Custodian observing therein that if the respondents 4 to 9 are restored to their original lands the persons to whom those lands had been allotted will have to be shifted elsewhere and this process may involve "an interminable chain of cancellation of allotments. " He also observed that if the Additional Custodian could not cancel the allotment because of the coming into force of the amended r. 14 (6), the Custodian General also would be incompetent to cancel it. Thereafter the Additional Custodian heard the application of the respondents 4 to 9 on merits and dismissed it. Against his order dismissing the application respondents 4 to 9 preferred a revision application before the Custodian General. Curiously enough the Deputy Custodian General, 742 who heard it, this time granted the application and set aside the allotment in favour of the appellants. The appellants thereafter moved the High Court of Punjab under article 226 of the Constitution. The matter went up before a single Judge of the High Court who dismissed the petition observing as follows : "If the order of cancellation against the present opposite parties was made after the 22nd July, 1952, the order was inoperative in view of Rule 14 (6) and if it be said that the order of allotment was after the date then Rule 14 (6) is not bar to the cancellation of the order. In either case I am of the opinion that there is no error in the order of the Custodian General sufficient for the purpose of quashing his order . " The appellants thereupon preferred an appeal under the Letters Patent which was also dismissed by a Division Bench of the High Court. The substance of the reasoning of the learned Judges is that the allotment in favour of respondents 4 to 9 was wrongly cancelled and it was the duty of the Custodian to restore to 'them the lands from which they were ousted. They also said that the provisions of r. 14 (6) (lid not preclude the Deputy Custodian General from exercising the powers conferred upon him by section 27 of the or prevented him from cancelling the allotment made after July 22, 1952. The view taken by the Division Bench to the effect that r. 14 (6) did not stand in the way of the Custodian General of the Custodian from restoring the lands to the respondents the allotment with respect to which was wrongly cancelled by the Custodian cannot be sustained. No doubt it is one of the highest duties of all courts to take care that the act of the court does not do injury to suitors; but the court must have power to rectify the wrong. 743 Such power may either inhere in the Court or may be expressly conferred by statute. The law does not confer any express power on the Custodian to make restitution. But we will assume that be had inherent power to do so. Just as power can be conferred expressly by statute it can also be taken away or restricted and where it is taken away or restricted then, whether the power was statutory in its origin or was inherent in the court, it will be either wholly unexercisable or exercisable only subject to the conditions laid down in the statute, as the case may be. Here we have the notification dated July 22, 1952 which substituted the present sub r. 6 of r. 14 for the original sub r. 6. The amended sub rule has placed a limitation on the powers of the Custodian to cancel allotment of rural evacuee property on a quasi permanent basis. The result is that an allotment of such land can be cancelled only in the circumstances specified in that sub rule. Therefore, subsequent to July 22, 1952 the Custodian of Evacuee Property would have the power to cancel an allotment only upon a ground which falls within the exceptions enumerated in sub r. 6. Making of restitution is not within the exceptions and, therefore, it will have to, be said that the inherent power of the Custodian to cancel an allotment for making restitution has been abrogated by the amended sub rule. The other argument of the Division Bench is to the effect that the powers of the Custodian General under section 27 are untouched by sub r. 6 of r. 14 and that despite the making of this rule the Custodian General was not prevented from cancelling an allotment made after July 22, 1952. Now section 27 of the Act provides that the Custodian General may call for the record of any proceeding in which 4 District Judge or a Custodian has passed an order for the purpose of satisfying himself as to the legality or propriety of any such order and may pass such order in relation thereto as he thinks At. The 744 District Judge or the Custodian can in any matter before him do only that which the act or the rules made thereunder permit or require him to do. If he fails to do what he is required to do or if he does something which he is not permitted to do or if he commits an error in doing an act which he is permitted to do, the Custodian General has the power to order that to be done which the law requires the Custodian or the District Judge to do or to quash that which has illegally been done or to rectify the error which the Custodian or the District Judge has committed. He has no power to do something which the Custodian or District Judge could not have done or was prohibited from doing. Clearly, therefore, the High Court was in error in holding that the limitations placed by the present sub r. 6 of r. 14 did not affect the power of the Custodian General. The learned single Judge as well as the Division Bench have taken the view that where an allotment is made in favour of a displaced person subsequent to July 22, 1952, the provisions of sub r. 6 of r. 14 did not preclude the Custodian from cancelling that allotment. This view is sought to be supported by Mr. Nanak Chand on behalf of respondents 4 to 9 on, what he says, the language of sub r. 6 of r. 14. He says that according to this sub rule what the Custodian is precluded from doing is to cancel an allotment which had already been made, that is, made before the coming into force of the sub rule except upon certain grounds and does not place any further restrictions. We do not find any justification for placing such a restricted interpretation upon the plain language of the Sub rule. Learned counsel then referred to the second proviso to the sub rule and contended that it supported the interpretation which he was placing. The proviso reads thus : "Provided that where an allotment is cancelled or varied under clause (ii) the allottee 745 shall be entitled to retain such portion of the land to which he would have been entitled under the scheme of quasi permanent allotment of land: Provided further that nothing in this subrule shall apply to any application for revision, made under section 26 or section 27 of the Act, within the prescribed time, against an order passed by a lower authority on or before 22nd July, 1952. " How this proviso supports the argument of the learned counsel is difficult to appreciate. The proviso was not originally there when sub r. 6 was amended on July 22, 1952. It is possible that a doubt was entertained after the making of this subrule on the question whether the Custodian General or the Custodian before whom a revision application had been made against an order passed before July 22, 1952, could make an order cancelling the allotment. Apparently to remove the doubt such as may have existed this proviso had been added. Then learned counsel contended that this subrule can not take away the wide powers conferred upon the Custodian by section 10 of the Act. No doubt section 10 confers wide powers on the Custodian but the opening words of the section show that the powers conferred thereby are subject to the provisions of ruler, made under the Act and section 56 (2) (i) enables the Central Government to make rules to provide for "circumstances in which leases and allotments may be cancelled or terminated or the terms of any lease, or agreement varied. " We, have, therefore, no doubt that the High Court was in error in holding that sub r. 6 of ' r. 14 was not a bar to the, exercise by the Custodian General of the power to cancel an allotment after July 22, 1952. Having failed on the point which alone finds a place in the statement of the cases of both the 746 parties, Mr. Nanak Chand raised a contention that the allotment in favour of the appellants was itself bad because the cancellation of the allotment in favour of the respondents 4 to 9 was in contravention of r. 14 (6) and that, therefore, the appellants were not entitled to the relief from the High Court under article 226 of the Constitution and accordingly are not entitled to any relief in this Court. Since the respondents have not relied upon this ground in the statement of their case we are not prepared to consider it. There may be more than one answer to the point urged by the respondents and had they specifically raised it in their statement of case, the appellants would have been in a position to give an appropriate answer. Accordingly we allow the appeal with costs and quash the orders of the High Court as well as of the Deputy Custodian General. There is one more matter to which we must refer. It is this. During the hearing of the appeal learned counsel for the appellant brought to our notice the fact that on the records of the proceedings before the Deputy Custodian General there was a slip of paper from which it would appear that Deputy Custodian General had been approached by the then Speaker of the Punjab Assembly apparently on behalf of the respondents. We, therefore, asked for a report from the High Court. That report has come and it exonerates both the ex Deputy Custodian General as well as the ex Speaker. We are not satisfied with the report. However, considering the fact that the matter has become quite stale and we have allowed the appeal we do not propose to examine the matter further. Appeal allowed.

Respondents Nos. 4 to 9 who were displaced persons from Pakistan, were allotted certain rural lands in village Karodian on a quasi permanent basis. On information being received from Pakistan that they were entitled to urban allotment their allotment in village Karodian was cancelled and they were allotted urban land. The land thus vacated in village Karodian was allotted to the appellants. On July 22, 1952, r. 14(6) of the Administration of Evacuee Property Rules was amended and the power of the custodian to cancel quasi permanent allotments of rural evacuee property was taken away except in certain enumerated circumstances. Thereafter respondents Nos. 4 to 9 applied to the Custodian for shifting back their allotment to village Karodian on the ground that they were really ' entitled to allotment of rural property. The Custodian dismissed the application holding that r. 14(6) did not permit the cancellation of the allotment of the appellants. Respondents Nos. 4 to 9 filed a revision application before the Custodian General who allowed the application and cancelled the allotment of the appellants. The appellants contended that the Custodian General had no power to cancel their allotment. The respondents replied that the wide powers of the Custodian General under s.27 of , were not affected by the restrictions imposed by the amended r. 14 (6) on the power of the Custodian to cancel allotments. Held, that the Custodian General had no power to cancel an allotment of rural property made on a quasi permanent basis in a revision application against an order of the Custodian made after July 22, 1952. The power of the Custodian under section 10 of the Act to cancel allotments was subject to the rules. The amended r. 14(6) restricted the power of the Custodian to cancel such an allotment to the circumstances mentioned therein and the present case did not fall within any of those excep 739 tions. Amended r. 14(6) could not be resorted to for cancellation of allotments made before July, 22, 1952. The power of the Custodian General under section 27 of the Act was to see whether the order passed by the Custodian was legal and proper ; he had no power to do something which the Custodian could not have done or which he was prohibited from doing.

Appeals Nos. 347 to 350 of 1960. Appeals by special leave from the judgment and order dated January 18, 1953, of the Incometax Appellate Tribunal, Calcutta Bench, in Incometax , Appeals Nos. 7062 7064 and C.P.T.A. No. 548 of 1951 52. N.C. Chatterjee, A. V. Viswanatha Sastri and D.N. Mukherjee, for the appellants. K.N. Rajagopal Sastri, and D. Gupta, for respondent. July 17. The Judgment of the Court. was delivered by HIDAYATULLAH, J. These appeals with special leave, were filed by one Kanhaiyalal Lohia, who died during the pendency of the appeals, and who 841 is now represented by the executors appointed under his will. By these appeals, which are consolidated, the appellants question an order dated January 8, 1953, of the Income tax Appellate Tribunal (Calcutta Bench) in appeals filed by the Department against the order of the Appellate Assistant Commissioner. The Tribunal reversed the order of the Appellate Assistant Commissioner and restored that of the Income tax Officer. Kanbaiyalal Lohia made petitions under section 66 (1) to the Tribunal, setting out a number of questions of which the following was I referred to the High Court : "Whether in the cirumstances of this case where the Income tax Officer, District III (2), separately assessed the business run in the name of Brijlal Nandkishore as belonging to a partnership firm consisting of Brijlal and Nandkishore, the Income tax Officer, Non Companies E. P. T., District can assess the income from the same business in the hands of the assessee ?" This question was answered against him. Kanhaiyalal Lohia also applied under section 66 (2) to the High Court of Calcutta for reference of the other questions, but failed. No appeal has been filed by him against the order of the High Court refusing to direct the tribunal to state a case or against the decision on the question referred, and the present appeals have been filed against the decision of the Tribunal. At the hearing of these appeals, we asked counsel for the appellants how, in view of the recent decisions of this Court in Chandi Prasad Chokhani vs State of Bihar (1) and Indian Aluminium Co. Ltd. vs Commissioner of Income tax (2), these appeals were maintainable, if the two decisions of the High Court had become final. Mr. A. V. Viswanatha Sastri relied upon the decisions in (1) ; (2) Civil Appeal No. 176 of 1959 decided on April 24, 1961. 842 Dhakeswari Cotton Mills Ltd. vs Commissioner of Income tax West Bengal (1) and Sardar Baldev Singh vs Commissioner of Income tax Delhi and Ajmer (2), and pointed out that in those cases, appeals were entertained from the Tribunal 's order, though he conceded with his usual frankness that special circumstances must exist. He contended that this was a case in which such circumstances existed. We shall deal with the appeals from that point of view, because unless special circumstances exist, the appeals must be regarded as not competent, in view of our recent rulings above mentioned. Kanhaiyalal Lohia, who was a prosperous dealer in jute, had his head office in Calcutta. He had no issue, and his family consisted of his wife,, his brother, Brijlal Lohia and Brijlal 's son, Nandkishore Lohia. The properties of Kanhaiyalal Lohia were self acquired, and he was always assessed as an individual. He maintained accounts according to the Ramaswami year. In his return for the account year, April 14, 1943 to April 1, 1944 corresponding to the assessment year, 1944 45), he indicated that he had closed down in the middle of 1943 his purchasing centres in East Bengal, which stood in the name of Nandkishore, and that, he had gifted to his brother Rs. 5,1 1, 1. 01 on July. 12, 1943, and to his nephew, Rs. 2,50,000 on September 30, 1943. He showed income of his East Bengal business only up to the closure of that business. Brijlal and Nandkishore entered into partnership between themselves, and started a business under the name and style of "Brijlal Nandkishore. " They took over the purchasing centres in East Bengal. They opened accounts in banks in the name of "Brijlal Nandkishore", and became members of the Baled Jute Association, and the Jute ,Baler,sAssociation, and traded in their own names. A deed of partnership between them was also executed on August 5, 1953. The business of Kanhaiyalal Lohia and of "Brijlal Nandkishore (1) ; (2) ; 843 was within the jurisdiction of the same Incometax Officer. In the assessment of the partnership firm, notices were issued to the partnership both under section 22(2) and section 34, and the partner ship also applied for registration under section 26A of the Income tax Act,which was granted. The partnership was also assessed for the years, 1945 46 and 1946 47. The assessment of Kanhaiyalal Lohia was completed by the Income tax Officer, Non Companies Income Tax cum Excess Profits Tax District, and during the assessment for the year, 1945 46 a notice was issued under section 22(4) of the Income Tax Act on August 24, 1949, calling for accounts of the head office at Calcutta and also the branches including the business being carried on as "Brijlal Nandkishore", Kanhaiylal Lohia proved, the above facts, producing the books of account, bank statements, registration certificate of "Brijlal Nandkhore" and evidence showing the membership of "Brijlal Nandkishore" of the two Associations. He also produced letters from four persons including one Sri A.L. Mazumdar who was questioned by the Income tax Officer without notice to ' Kanhaiyalal Lohia and whose statement was also recorded. Kanhaiyalal Lohia objected to this procedure, but the Income tax Officer, it is alleged, paid no heed to his protests, and on. March 31, 1950 the assessment was completed, and the income of the branches under the direct control of "Brijlal Nandkishore" was pooled with the income of Kanhaiyalal Lohia. The Income tax Officer held that the gifts were not bonafide, and were colourable transactions. He relied upon the statement of Sri A. L. Mazumdar, which was recorded when Kanhaiyalal Lohia was not present. Against the assessment, Kanhaiyalal Lohia, appealed to the Appellate Assistant Commissioner before whom two more letters from leading businessmen were filed. The Appellate Assistant Commissioner accepted the letters which were filed, and held that the gifts were proved and were bona fide and directed the exclusion 844 of the income of "Brijlal Nand kishore" from the assessment of Kanhaiyalal Lohia. The order of the Appellate Assistant Commissioner was pronounced on December 27, 1951. The Department appealed to the Appellate Income tax Tribunal, Calcutta Bench. The Tribunal disagreed with the Appellate Assistant Commissioner, all held on January 8, 1953, that the gifts were not proved by the assessee by unimpeachable evidence, and that the income of "Brijilal Nandkishore" was rightly included in the assessment. As stated already,. applications under section 66 (1) and section 66 (2) were made to the Tribunal and the High Court respectively. The Tribunal referred one question, but declinedto refer the. other quest ions. The High Court then moved under section 66 (2) but without success. The High Court agreed with the Tribunal and answered the question which was referred, against Kanhaiyalal Lohia. Before the High Court, Kanhaiyalal 's counsel, Dr. Pal, admitted that he. could not persuade the Court to answer the referred question against the, Department, and it appears that it was conceded by the Department before the High Court that the assessment of "Brijlal Nandkishore" would be cancelled. Kanhaiyalal Lohia then filed the present appeals against the order of the Tribunal dated January 8, 1953. This Court has pointed out in Chandi Prasad, Chokhani vs State of Bihar(1) and Indian Aluminium Co., Ltd. vs Commissioner of Income tax (2) that the two cases in which this Court interfered with appellate orders of a Tribunal and relied upon before us, were of a special kind. In Dhakheshwari Cotton Mills case(3) there was a breach of the principle, of natural justice, and that was held sufficient to entitle an aggrieved party to come to this Court against the appellate order of the Tribunal under article 136. In (1) ; (2)Civil Appeal No. 176 of 1959 decided on April 24, 1961. (3) ; 845 Baldev Singh 's case (1) this Court entertained an appeal against the appellate order of the Tribunal, because limitation to take other remedies was IS barred without an fault of the assessee concerned. The ratio in each of these cases is that a circumstance which cannot be corrected by the procedure of a stated question of law on a statement of the case may afford a ground for invoking the jurisdiction of Court under article 136. That ratio does not apply, where a question of law can be raised, and is capable of being answered by the High Court or on appeal by this Court. An appeal against an order of the High Court deciding a question referred or against a refusal to call for a statement can be brought before this Court under section 66A, if the High Court decides the question referred and under article 136, if the High Court refuses to call for a statement. In the present case, the order of the High Court on the question referred was not brought before this Court by the ordinary, mode indicated in the Indian Income tax Act, presumably because of the concession of counsel that he could not claim that the question be answered in favour of the assessee and the attitude of the Department that the assessment of "Brijlal Nandkishore" would be cancelled. The order refusing to call for a statement on questions other than the one referred is also not questioned before us. The attempt is to bring this case within the ratio of Dhakeshwari Cotton Mills ' case(2),and in support, it has been pointed out mainly that the examination of Sri A. L. Mazumdar in the absence of Kanhaiyalal Lohia was against the principles of natural justice. The statement of Sri A. L. Mazumdar was taken on March 28, 1950, and it is recorded as follows : "Mr. Mazumdar is questioned by me as to what be knows regarding the alleged gift as recorded in the books of Kanhaiyalal Lohia in favour of Brijlal and Nand Kishore. He says (1) ; (2) ; 846 that I don 't remember things very distinctly but 1 can say that the gifts to Brij Lal or Nand. Kishore were not made in my presence as alleged. Mr. Kanhaiyalal Lohia used to tell me that his brother and nephew are idling away their time hence I shall give them a. gift and make them work by that money. The partnership deed was most probably drawn up by me. The gift, was reported to have been made to Brij Lal and Nand Kishore before I should have taken up the drafting of the deed. Kanhaiyalal told me several times that he wanted to separate his brother and nephew. When the firm was started then Brijlal came to me and asked me if father and son 's partnership deed could be drawn up. I don 't know anything else than this in the matter. " The lie given by Sri Mazumdar to the statement of Kanhaiyalal Lohia has affect his credibility. The order sheet shows that Mr. B. Sen Gupta took a copy of Sri Mazumdar 's statement and expressed a desire to cross examine him; but when the opportunity was given, he failed to appear. It is impossible to think in these circumstances that there has been any breach of the principles of natural justice. The order sheets of March 29 and 30, 1950 clearly record the absence of Mr. B. Sen Gupta. In our opinion, there is no breach of the principles of natural justice in this case to entitle the appellants to invoke the ruling in Dhakeshwari Cotton Mills case It was contended before us that the finding of the Tribunal was perverse, and that on an examination of the total circumstances, it is quite clear that the gifts were not only real, but were acted upon. This was a matter within the jurisdiction of (1) ; 847 the Appellate Tribunal as the final fact finding authority. The Tribunal acted within its powers in refusing to accept the evidence tendered, and looking at the circumstances of the. case, we cannot say that the finding has been perversely reached. For a number of years, the brother and the nephew were supported by Kanhaiyalal Lohia, and it does not appear that a gift of even a small sum was made to them to put them on their legs. Suddenly in the year 1943, 'Kanhaiyalal Lohia made up ' his mind to put them in business with a gift of the order of Rs. 7,60,000 odd. For this purpose, he had to overdraw his accounts with the Bank and to pay interest to the Bank. It does not appear why he felt that the establishment of his brother and nephew in business should be made on such a grand scale, which involved him in debt. This circumstance, taken with the fact that Mr. Mazumdar stated that he had always complained that they were good for nothing and were idlers, makes the transactions auspicious. It was presumably done with a view to reduce the assessable profits in the hands of Kanhaiyalal Lohia, and on the evidence, the Tribunal was entitled to hold, as it did, that this was a sham transaction. In our opinion, no special circumstances exist, on which the appellants can claim to come to this Court against the decision of the Tribunal, by passing the decision of the of High Court on the question referred and there fusal 'the High Court to call for a statement of the case from the Tribunal on questions which the Tribunal refused to refer to the High Court. The appeals are, therefore, within the rulings of this Court in Chandi Prasad Chokhani vs State of Bihar (1) and Indian Aluminium Co., Ltd. vs Commissioner of Income tax(2), and must be regarded as incompetent. The appeals are dismissed with costs, one set. Appeal dismissed.

The appellant supported his brother and his nephew for a number of years as they were doing no work. In the year 1943 he made a gift of Rs. 7,60,000 odd to them though he had to overdraw his account with the Bank and to pay interest or the amount borrowed to raise the money. He also made a transfer of some of his businesses to them. His explanation was that these gifts were made to set these two persons up in business. The Income tax Officer held that the gifts were riot bonafide and he assessed, the income of all the businesses in the hands of the appellant. The appellant had produced letters from some businessmen in support of his case. One such person was one M. who was examined by the Income tax Officer without notice to the appellant. Later, however, a copy of the statement of M. was taken by the appellant 's counsel and at his request M. was summoned for cross examination but on the date fixed none appeared for the appellant who was also absent. The appellant made a petition under section 66(1) of the Income tax Act to the Tribunal asking that a number of questions of law be referred to the High Court. Only one question was referred by the Tribunal which declined to refer the other questions. In the High Court the question referred by the Tribunal was answered against the appellant on the admission of his counsel. The High Court was moved also under section 66(2) to order a reference of the remaining questions but the High Court rejected the application. The appellant did not appeal against these two orders of the High Court and instead filed appeals against the orders of the Tribunal. The appellant relied upon two cases of this Court viz. Dhakeshwari Colton Hills ' Case and Baldev Singh 's case and contended that tile appeal to this court was competent. Held, that the appeals were incompetent in view of the decisions of this Court in Chandi Prasad Chokhani vs State of Bihar and The Indian Aluminium Co., Ltd. 840 Held. further, that an appeal against an order of the High Court deciding a question referred or against a refusal to call for a statement can only be brought before the Supreme Court under section 66(A) of the Income tax Act, if the High Court decides the question referred, and under article 136 of the Constitution if the High Court refuses to call for a statement. There can be no direct appeal to the Supreme Court by passing the decisions of the High Court. Held,. also, that there was neither any breach of the principles of natural justice in this case nor the existence of circumstances as existed in Baldev Singh 's case to justify the appeal. Held, that where a witness has been examined by the Income tax Officer behind the back of the assessee but a copy of the statement of the witness is made available, to the assessee and an opportunity is given to him to cross examine the witness, thereis no breach of the principle of natural justice. ChandiPrasad Chokhani vs State of Bihar. (1962) 2 S.C.R. 276and Indian Aluminium Co., Ltd., vs Commissioner of Income tax. (Civil Appeal No. 176 of 1959, decided on April 24, 1961) followed. Dhakeshwari Cotton Mills Ltd. vs Commissioner of Income. tax ; and Sardar Baldev Singh vs Commissioner of Income tax, Delhi and Ajmer. ; , explained. ,

Appeals Nos. 1661 68 of 1959. Appeals by special leave from the judgment and decree dated April 15, 1955, of the former Hyderabad (now Andhra Pradesh) High Court in Reference Nos. 198 and 199 of 1953 and 19 of 1954. A.V. Viswanatha Sastri and K. R. Choudhri, for the appellant. K.N. Rajagopal Sastri and D. Gupta,, for the respondent. July 17. The Judgment of the Court was delivered by HIDAYATULLAH, J. The appellant, Rajah Hid section V. Jagannath Rao, was the Jagirdar of Jatprole Samasthan in the former Hyderabad State. In the year 1357 Fasli, the Income tax Act (1357 Fasli) was passed by the Legislature, to come into force on Azur 1, 1357 Fasli. The present appeals, with special leave, concern the assessment of the appellant 's income to income tax and super tax under the Act of 1357 Fasli for the assessment years, 1357 Fasli and 1358 Fasli, corresponding to 850 the years, 1948 49 and 1949 50. They are directed against a common judgment of the High Court of Hyderabad, by which certain questions of law referred by the Income tax Appellate Tribunal, Bombay, in the assessment of the present appellant and some others, were answered by the High Court of Hyderabad against the present appellant. The appellant had submitted returns of his income for the two accounting years under protest. According to him, the Income tax Act, 1357 Fasli was ultra vires the by legislature. For the account year 1356 Fasli, corresponding to the assessment year, 1357 Fash, the appellant had urged that the Act could not affect the income of that year, because it came into force only from Azur 1, 1357 Fasli. The appellant also claimed to deduct certain expenses (details of which will be given later) under as. 14(5)(a) and (b) of the Act. These were the three matters on which the Income tax Appellate Tribunal framed the following three questions for the decision of the High Court : "1. Whether the Hyderabad Income tax Act is ultra vires in so far as it seems to levy a tax on Jagirs and Samasthans ? 2.Whether the provision relating to the taxation of income of 1356 F in the Hyderabad Income tax Act is intra vires ? 3.Whether the sum of Rs. 14,390 and Rs. 38, 079 or a part thereof, could be allowed as revenue deduction under section 14(5)(a) or 14(5)(b) of the Hyderabad Income tax Act ?" As stated already, all the three questions were answered by the High Court against the appellant. He obtained special leave from this Court on three separate petitions for special leave, on December 17, 1966, and April 9, 1957, and filed the present appeals. 851 The second question mentioned above is covered by the decisions of this Court in Union of India vs Madan Gopal Kabra (1) and Rajputana Mining Agencies Ltd. vs The Union of India and another (2) and was, therefore, rightly answered against the appellant. Mr. A. V. Viswanatha Sastri, counsel for the appellant, conceded frankly that he had nothing to urge against the decision of the High Court on that question. We shall, therefore, confine ourselves to the two remaining questions in these appeals. It may be mentioned that the ,first question also arises in Civil Appeal No. 17 of 1961, and what we say here will govern the disposal pro tanto of that appeal also. The contention of the appellant on the validity of the Act is this : The Act was passed by the Hyderabad Legislative Assembly and was assented to by His Exalted Highness, the Nizam. Under the Hyderabad Legislative Assembly Ain, there was a prohibition on the introduction of certain kinds of bills in the Assembly. The appellant relies upon sub sections (8) and (9) of section 18 of the Ain, which in their English translation read as follows "18. There shall not be introduced into, or moved in the Assembly,, any bill, or motion, or resolution, or question, or other proceedings relating, to or affecting the following matter: (8)The relation of His Exalted e Highness with the holders of Samasthanis and Jagirdars and with such other grantees as derive grants from sanads. (9)The powers of His Exalted Highness over the present or future grants, whether they be in the form of land or cash.". (1) ; (2) ; 852 These two sub sections deal with laws affecting the relations between the holders of Samasthans and JaGirs on the one hand, and His Exalted Highness the Nizam, on the other. The Act in question imposes a tax and does not seek to affect the relations aforesaid. It is a little difficult to read into the Income tax Act any encroachment upon the relations between the holders of Samasthans and Jagirs and the Nizam. Even if the Income tax Act can be said to affect indirectly those relations, it is manifest that it was passed with the assent of the Ruler, which admittedly was given. There have been a number of rulings of this Court on the powers of Rulers of Indian States to promulgate laws in their States in the exercise of their sovereignty and on the nature of their sovereignty. Two such cases of this Court 'Considered the legislative powers of His Exalted Highness the Nizam, and in those cases, it was held that the legislative power of the Nizam was not subject to any limitations or control of any kind whatever. The first of these cases, Ameer un Nissa Begum vs Mahboob Begum (1) dealt with a Firman issued by His Exalted Highness the Nizam, and. in dealing with his powers, in general and his legislative powers, in particular, it was observed by this Court as follow: "It cannot be disputed that prior to the integration of Hyderabad State with the Indian Union and the coming into force of the Indian Constitution, the Nizam of Hyderabad enjoyed uncontrolled sovereign powers. He was the supreme legislature, the supreme judiciary and the supreme head of the executive, and there were no constitutional limitations upon his authority to act in any of these capacities. The 'Firmans ' were expressions of the sovereign will of the Nizam and they were binding in the same way as (1) A.I.R. 1955 &C. 352. 853 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 govern or regulate the rights of the parties concerned though it could be annulled or modified by a later 'Firman ' at any time that the Nizam willed. " The same view was reaffirmed in the second case reported in Director of Endowments, Government of Hyderabad vs A kram Ali (1). It is contended that a limitation on the powers of the Legislative Assembly in Hyderabad State was created by the Ain, which was, in essence the supreme law, and any bill introduced in contravention of the Ain was void ab initio. According to the learned counsel for the appellant, a law which was void at its inception remained so, even if subsequently assented to by the Nizam. If one were to think in terms of a legislature of limited jurisdiction, this might be true. Laws are really commands embodying rules of conduct emanating from one whose will is sovereign, or, in other words, supreme. Legislative Sovereignty must be found to uphold the laws. It depends upon the ' Constitution of a particular State, where it resides. It may not reside in a Ruler but in a legislature where the Ruler has surrendered or been made" to surrender his powers, as, for example, the King in Parliament in England, or it may reside in ' an absolute and sovereign Ruler, who has not parted with it, the legislature being merely his amanuensis. In the latter case, the will of the Ruler expressed as a rule of conduct is the law, whether made by him directly or through his legislature. The Ain itself derived its authority from the Nizam only, and the Nizam, as the supreme legislator, could frame a law in derogation of the Ain, which was his own creation. The Ain was (1) A. I. R. 854 not a supreme law such as a Constitution, the limits imposed by which could not be exceeded even by the Nizam. The Ain prohibited the, introduction of laws of a particular kind in the Assembly, and the Nizam could reject them as being in contravention of the Ain even if passed by the Assembly. The position, however, was not the same when a law which the Nizam could refuse to accept was accepted by him. As a supreme legislator, the Nizam could have written out the entire Income tax Act in his own hand writing and signed it; and it would have been as valid and binding as the Ain itself. It made no difference if the law was passed by a body of men and was sent to the Nizam for his assent, because on his assent, the law was as effective as if made by the Nizam himself. The Nizam could withhold his assent to a law contrary to the Ain if he chose; but once he assented to it. , the law derived its vitality, not from the act of the Legislative Assembly but from the act of the Nizam. It could not be questioned any more than a Firman issued by the Nizam. The Income tax Act must, therefore, be regarded as binding upon those affected by its terms, and the question whether it could be introduced in the Legislative Assembly hardly arises. It must be regarded as a law emanating from His Exalted Highness the Nizam, the supreme legislator in the State, whose laws promulgated in any manner were binding upon the subject. See Madhaorao vs State of Madhya Bharat (1). The first question was thus answered correctly by the High Court. It remains to consider the third question. in the assessment year 1357 Fasli, a sum of Rs. 14,390 was claimed as expenses under a. Act (5) (a) or s.14(5)(b) of the Hyderabad Income tax Act. A sum of Rs. 38,079 was similarly claimed for the assessment year 1358 Fasli. The sum of Rs. 14,390 has been (1) ; , 855, ,shown in the assessment year as spent on account of "domestic servants, drummers and other paraphernalia", which the Income tax, Officer treated as personal expenditure. The sum 'of Rs. 38,079 for the following year consisted of these items (a) Stables and elephants Rs. 16,907 (b) Festivals and Jatras Rs. 789 (c) Charity and subscriptions Rs. 11,233 (d) Body guards Rs. 9,150 _______________ Rs. 38,079 _______________ The Income tax Appellate Tribunal allowed these expenses as being admissible under cls. (a) and (b) of section 14(5). No reasons were given by the Tribunal for coming to this conclusion. The High Court answered the question against the assessee without advertence to the two clauses. The reason given by the High Court was as follows : "The jagirdar, however anxious he be to maintain his dignity, cannot claim deductions of money so spent professedly unless there be orders in exercise of prerogative powers of the grantor authorising such expenditures. For example, he may be authorised by the Sanad creating his tenure to maintain elephants or bodyguards. These expenditures would then though personal, be necessary and legal, because of the constitutional position of the grantor when the tenure was created and con tinued. But the statement of the case should show the legal basis upon which deductions are allowed. If the assessee was entitled to maintain elephants, stables, paraphernalia etc. , under the grants, he should have filed them before the Income tax authorities. Evidently this has not been done; at any rate there is no mention of the fact in the statement of the case. In the result, the answer to the question is in the negative," 856 The relevant provisions of the law may now be read. Section 14 (5) as translated by Messrs Ramchandra Rao Kurtadikar and B. V. Subbarayudu reads as follows : "In respect of income from land revenue paid to the Jagirdar by the holder of any non Khalsa land in lieu of the use or possession thereof and in respect of any income derived by giving over Abkari trees for extracting sendhi or toddy and from "Baitbak 'which under proviso 2 and Explanation respectively of clause (4) of section 2, is deemed to be non agricultural income, such income, profits and gains shall be computed after making the following allowances : (a)All such expenses not being his private or personal expenses which the assessee may incur in relation to such land or the inhabitants thereof towards management or superintendence or on works of public welfare. (b)Such necessary expenditure as the assessee may incur under any law. (c)Five per cent of the income chargeable to tax towards necessary expenses. " The Tribunal, however, pointed out that the English text published by Government Press, Hyderabad, was slightly different. It reads as follows : "14 (5) The income from land revenue paid to jagirdar by the occupier of non Khalsa land for its use or possession, the income that arises from renting of trees for extraction of sendhi or toddy, the income from Abkari rental$ and the income which under the provi sions of Section 2 (4) is deemed to be ,non agricultural ' income, all such incomes, profits 857 and gains shall be computed after making the following allowances namely: (a)all such expenditure,, not being, in the natureof capital, private or personal expenditure, incurred by the assessee in connection with land or its inhabitants for administration or on works of general improvement and benefit ; (b)any compulsory expenditure incurred by such assessee under any law in force and (c)in respect of compulsory expenditure five per cent of the income subjected to tax." A literal translation of cl. (a) made by us reads as follows " 'All such expenditure which the assessee makes in connection with such land or its inhabitants on administration or works of public welfare, which expenses. do not include, his private or personal expenses. " This shows that the official translation is accurate., and we shall refer to it only. The question thus is whether the expenditure in respect of which deduction is, claimed can be described to be private or personal expenditure of the assessee, or in connection with land and its administration. The High Court apparently thought that unless it ' was incumbent upon the jagirdar by reason of his Sanad to maintain bodyguards. , elephants, etc., the expenses could not but be regarded as private or personal. In our opinion the High Court put the burden of proof somewhat strictly upon the assessee. The Tribunal, though it gave no reasons. , held that the expenses were incurred in relation to the management. The conclusion is based on some evidence. The maintenance 858 of elephants, $tables, bodyguards, etc., is not entirely for the Jagirdar 's personal or private ends, and cannot be said to be wholly unrelated to the management of the Estate. Such equipage is considered part and parcel of the administration of an estate, such as jagir. Elephants, drummers and bodyguards are used on occasions for administ rative purposes, and even if these might be few and far between, the expenditure must be regarded as one incurred in connection with land and its administration. The expenses over drummers (but not over domestic servants) in the first year, and over stables, elephants and bodyguards (but not over festivals and jatras or on charities and subscriptions) in the second year, were deductible. These expenses fall within c 1. (a) of section 14 (5) as expenditure in connection with land or its administration, and they amounted to Rs. 26,057 in the year 1358 Fasli. For the year 1357 Fasli, the amount debatable to these items from Rs. 14,390 will have to be determined. ' The evidence before us is not sufficient to state the exact amount. We set aside the answer of the High Court, and answer the third question in the affirmative, to the extent indicated here. In view of the partial success in these appeals, the parties shall bear their own costs in this Court. A appeals allowed in part.

The appellant who was a jagirdar in the former Hyderabad State was assessed to income tax and super tax for the assessment years, 1337 Fasli and 1358 Fasli, corresponding to the years, 1948 49 and 1949 50, under the provisions of the Hyderabad Income tax Act, 1357 Fasli, which was passed by the Hyderabad Legislative Assembly and came into force on Azur 1, 1357 Fasli. The appellant challenged the validity of the assessment on the grounds(1) that under the Hyderabad Legislative Assembly Ain the Assembly was prohibited from introducing bills which dealt with laws affecting the relations between the holders of jagirs on the one hand and the Nizam on the other, that the provisions of the Act in so far as they seemed to levy a tax on jagirs amounted to an encroachment upon the relations between the jagirdars and the Nizam, and that the bill introduced in contravention of the Ain was, void ab initio, even though it had been assented to by the Nizam, (2)that the Act could not affect, in any case, the income for the account year 1356 Fasli, corresponding to the assessment year 1357 Fasli, because the Act came into ' force only from Aur 1,1357 Fasli, and (3) that the Income tax Officer erred in disallowing the claim for deduction of the amount spent on account of maintenance of elephants, stables, drummers,, bodyguards, etc., in connection with management of the jagir Estate, and in treating the amount as personal expenditure. Held, (1) that the Hyderabad Income tax Act, 1357 Fasli, did not affect the relations between the holders of Jagirs and the Nizam, and that even if it could be said to affect indirectly these relations, the Act having been passed with the assent of the Nizam, was valid, and the question whether it could be introduced in the Legislative Assembly did not arise as it must be regarded as a law emanating from the Nizam, the supreme legislator in the State, whose laws promulgated in any manner binding upon the subject,. 849 Ameer un Nissa Begam vs Mahboob Begum, A. I. R. 1955 section C. 352, Director of Endowments, Government of Hyderabad vs Akram Ali, A. 1. R. and Madhaorao vs State of Madhya Bharat, ; , applied. (2)that the income for the 1356 Fasli was rightly assessed tinder the provisions of the Act for the assessment year 1357 Fasli. Union of India vs Madan Gopal Kabra, ; and Rajputana Mining Agencies Ltd. vs The Union of India, ; , followed. (3)that the maintenance of elephants, stables, drummers, and bodyguards by the jagirdar was not entirely for his personal or private ends but must be considered part and parcel of the administration of the estate, and the expenditure for such maintenance must be regarded as one incurred in connection with land and its administration within the meaning of section 14(5)(a) of the Act. It was accordingly deductible for purposes of income tax.

Appeal No. 349 of 1959. Appeal from the judgment and order dated February 1, 1957, of the Punjab High Court, in Civil Writ Application No. 385 of 1955. B. K. Khanna and D. Gupta, for the appellants. The respondent did not appear. May 4. The Judgment of the Court was delivered by SUBBA RAO, J. This appeal by certificate is preferred against the order of the Punjab High Court dated November 9, 1956, setting aside the order of the Consolidation Officer and directing him to proceed with the matter in accordance with law. The respondents are members of a joint Hindu family and are evacuees from Pakistan. On March 3, 1950, in lieu of the lands left by the family in Pakistan, the Custodian of Evacuee Property allotted to the said. family 11 standard acres and 9 units of Grade 'A ' land in Pati Kankra, Shahabad Estate in Tehsil Thanesar in Karnal District. The said units were valued as equal to 123 standard kanals and 18 standard marlas of 'A ' Grade land. The family took possession of the said land, and, it is alleged, made improvements thereon. On July 28, 1954, the State Government issued a notification under section 14 of the East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948 (hereinafter called the Act), declaring its intention to make a scheme for the consolidation of the holdings. On April 30, 1955, a draft scheme was proposed by the Consolidation Officer and published indicating, inter alia, that the respondents ' family would be given 84 standard kanals consisting of 50 standard kanals and 7 standard marlas of 'A ' Grade land, and 34 standard kanals and I standard marla of 'B ' Grade land. The lands proposed to be substituted for the lands already allotted on quasi permanent tenure to the respondents ' family are admittedly of a lesser value than the land allotted to them earlier. The said consolidation was not made 714 in strict compliance with the provisions of the Act, but pursuant to administrative directions given to the Consolidation Officer by the State Government. Broadly stated, under the said directions the Consolidation Officer was directed to take into consideration, for the purpose of consolidation, the number of acres held by the evacuee and not the actual valuation at site of the land allotted to him. The objections filed by the respondents were rejected by the Consolidation Officer. By an order dated August 6, 1958, the Settlement Commissioner confirmed the scheme pro pounded by the Consolidation Officer. Meanwhile, the (44 of 1954) became law; it came into force on October 9, 1954, i.e., after the Estate had been notified for consolidation of holdings. On March 24, 1955, the Central Government issued a notification under section 12 of the Displaced Persons Act (44 of 1954) acquiring all the evacuee properties to which that Act applied. This notification was issued before the scheme of consolidation was confirmed by the Settlement Commissioner. On February 23, 1956, the Central Government issued a sanad conferring proprietary rights on the respondents in respect of the lands allotted to them in 1950. This sanad was issued after the order of the Settlement Commissioner confirming the scheme of consolidation. On November 9, 1955, i.e., before the said sanad was issued to them, the respondents filed a petition in the High Court of Punjab under article 226 of the Constitution praying for the issue of an appropriate writ to quash the said scheme of consolidation. The High Court by its final order dated February 1, 1957, allowed the said objection and issued a direction to the Consolidation Officer to proceed with the matter before him in accordance with law. Mr. Khanna, learned counsel for the State, raised before us the following two points: (1) The respondents had no legal right to maintain the petition under article 226 of the Constitution. And (2) the directions issued by the State Government were validly issued and, therefore, the Consolidation Officer was 715 within his rights to formulate the scheme on the basis of those instructions. ' Re. The existence of a right and the infringement thereof are the foundation of the exercise of the jurisdiction of the court under article 226 of the Consti tution. The right that can be enforced under article 226 of the Constitution shall ordinarily be the personal or individual right of the applicant. It may be first considered whether the respondents had such a right on the date when they filed the petition under article 226 of the Constitution. They filed the petition on November 9, 1955, i.e., after the Central Government issued the, notification acquiring all the evacuee properties and before it issued the sanad conferring proprietary rights on the respondents in respect of the lands allotted to them. The nature of interest of a displaced person in the properties allotted to him under the evacuee law has been authoritatively decided by this Court in Amar Singh vs Custodian, Evacuee Property, Punjab (1). There, Jagannadhadas, J., speaking for the Court, after an elaborate survey of the law on the subject, came to the conclusion that the interest of a quasi permanent allottee was not property within the meaning of article 19(1)(f) and article 31(2) of the Constitution. But the learned Judge made it clear that, notwithstanding the said conclusion an allottee had a valuable right in the said interest. The learned Judge stated the legal position in the following words: "In holding that quasi permanent allotment does not carry with it a fundamental right to property under the Constitution we are not to be supposed as denying or weakening the scope of the rights of the allottee. These rights as recognized in the statutory rules are important and constitute the essential basis of a satisfactory rehabilitation and settle ment of displaced land holders. Until such time as these land holders obtain sanads to the lands, these rights are entitled to zealous protection of the constituted authorities according to administrative rules and instructions binding on them, and of the (1) [1957] S.C.R. 801, 836. 716 courts by appropriate proceedings where there is usurpation of jurisdiction or abuse of exercise of statutory powers. " It may be mentioned that the learned Judge in coming to the conclusion noticed all the relevant Acts on the subject, including the (44 of 1954) and particularly section 12 thereof. The observations of this Court indicate that notwithstanding such notification an evacuee has a valuable right in the property allotted to him, and that the said right is entitled to the protection of the constituted authorities and the courts. A perusal of the relevant provisions of Act 44 of 1954 demonstrates the correctness of the said observations. Section 10. Where any immovable property has been leased or allotted to a displaced person by the Custodian under the conditions published (a) by the notification of the Government of Punjab in the Department of Rehabilitation No. 4891 S or 4892 S, dated the 8th July, 1949; or (b) by the notification of the Government of Patiala and East Punjab States Union in the Department of Rehabilitation No. 8R or 9R, dated the 23rd July, 1949, and published in the Official Gazette of that State, dated the 7th August, 1949, and such property is acquired under the provisions of this Act and forms part of the compensation pool, the displaced person shall, so long as the property remains vested in the Central Government, continue in possession of such property on the same conditions on which he held the property immediately before the date of the acquisition, and the Central Government may, for the purpose of payment of compen sation to such displaced person, transfer to him such property on such terms and conditions as may be prescribed. Section 12. (1) If the Central Government is of opinion that it is necessary to acquire any evacuee property for a public purpose, being a purpose connected with the relief and rehabilitation of displaced persons, including payment of compensation to such 717 persons, the Central Government may at any time acquire such evacuee property by publishing in the Official Gazette a notification to the effect that the Central Government has decided to acquire such evacuee property in pursuance of this section. A reference to r. 14(6) of the rules made under the , will also be useful in this context. Tinder that rule, the Custodian has no power to make any order after July 22, 1952, cancelling or varying the allotments made, subject to certain exceptions with which we are not concerned here. The result of these provisions is that under the , the respondents became quasi permanent allottees in respect of the land allotted to them in 1950. After July 22, 1952, the Custodian ceased to have any authority to cancel or modify the said allotment. After the notification issued by the Government under section 12 of the Act, so long as the property remained vested in the Central Government, the respondents continued to be in possession of the property on the same conditions on which they held the property immediately before the date of acquisition, that is, under a quasi permanent tenure. The contention that on the issue of the said notification, the respondents ceased to have any interest in the said land is without any foundation. It is, therefore, clear that on the date when the respondents filed the petition in the High Court they had a very valuable, right in the properties allotted to them which entitled them to ask the High Court to give them relief under article 226 of the Constitution. That apart, on February 23, 1956, the Central Government issued a sanad to the respondents conferring an absolute right on them in respect of the said properties. Though the sanad was issued subsequent to the filing of the petition, it was before the petition came to be disposed of by the High Court. At the time the High Court disposed of the petition, the limited right of the respondents had blossomed 91 718 into a full fledged property right. In the circumstances of the case, the High Court was fully justified in taking note of that fact. From whatever perspective this case is looked at, it is obvious that the respondents hate sufficient interest in the property to sustain their petition under article 226 of the Constitution. Re (2). The second point has absolutely no legs to stand upon. The East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948, was enacted, in the words of the long title annexed to the Act, to, provide for compulsory consolidation of ' agricultural holdings and for the. prevention of fragmentation of agricultural holdings in the State of Punjab. Under section 15 of the said Act, the scheme prepared by the Consolidation Officer shall provide for the payment of compensation to any owner who is allotted a holding of less market value than that of his original holding and for the recovery of compensation from any owner who is allotted a holding of greater market value than that of his original holding. There is no provision in the Act empowering the Consolidation Officer to deprive a person of any part of his property without allotting to him property of equal value or paying him compensation if he is allotted a holding of less market value than that of his original holding. In the present case it is not disputed that while the respondents were allotted 123 kanals and 18 marlas of 'A ' Grade land on a quasi permanent basis by the Custodian and later confirmed by the Central Government, the consolidation proceedings gave him only 50 kanal 8 and 7 marlas of 'A ' Grade land, and 34 kanals and 1 marla of 'B ' Grade land. The area given under the consolidation pro ceedings is admittedly of less value than that of the holding allotted to the respondents by the Custodian, and the Consolidation Officer has not paid any compensation for the deficiency. This unjust situation in which the respondents have been placed is sought to be supported by learned counsel for the State on the basis of the instructions given to the Consolidation Officer by the State Government. There is no provision in the Act empowering the State Government to 719 give any such instructions to the Consolidation Officer; nor does any provision of the Act confer on the State Government any power to make rules or issue notifications to deprive owners of land of any part thereof or to direct the Consolidation Officer as to how he should exercise his statutory duties. Any such rule would be repugnant to the provisions of the Act. That apart, no such statutory rule empowering the State Government to issue such instructions has been placed before us. Both here as well as in the High Court, learned counsel appearing for the State has not been able to sustain the validity of such instructions on any legal basis. The order of the appropriate officers confirming the 'scheme on the basis of the said instructions was obviously illegal and, therefore, was rightly set aside by the High Court. In the result, the, appeal fails and is dismissed with costs. Appeal dismissed.

The respondents, a joint Hindu family and evacuees from Pakistan, were allotted certain lands by the Custodian of Evacuee Property. A draft scheme for consolidation of holdings was framed and published by the Consolidation Officer in pursuance of a notification by the State Government under section 14 of the East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948. The scheme under the directions of the State Government and contrary to the Act substituted lands of a lesser value for those already allotted to the respondents. Objections filed by the respondents were rejected by the Consolidation Officer and the scheme was confirmed by the Settlement Commissioner. Before the confirmation, the Central Govern ment by a notification under section 12 of the , acquired all evacuee properties and after the said confirmation issued a sand conferring proprietary rights of the said lands on the respondents. The respondents bad moved the High Court under article 226 of the Constitution before the issue of the sanad but the matter was finally disposed of by the High Court thereafter by setting aside the said scheme and directing the Consolidation Officer to dispose of the matter according to law. Held, that the notification issued by the Central Government under section 12 of the , did not put an end to the rights the respondents had in the lands originally allotted to them by the Custodian and they had the right to move the High Court under article 226 of the Constitution. Sections 10 and 12 of the said Act read with r. 14(6) of the Rules framed under the , made it amply clear that the respondents held a quasi permanent tenure in the said lands and as such had a valuable right therein. Such right continued while they remained in possession and the lands remained vested in the Central Government and with the grant of the sanad the limited right they had in the lands became a full fledged right of property. Amar Singh vs Custodian, Evacuee Property, Punjab, [1957] S.C.R. 801, referred to. The East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948, did not empower the Consolidation Officer to take away an allottee 's lands without giving him other lands of equal value or paying compensation nor did the Act empower the State Government either to do so in any way or to direct the Consolidation Officer as to how he should exercise his powers thereunder. Since, in the instant case, the respondents ' lands had admittedly been substituted by lands of less value and no compensation had been paid to them, the High Court was right in setting aside the order confirming the scheme. 713

Appeals Nos. 509 and 510 of 1960. Appeals by special leave from the judgment and order dated October 26, 1956, of the former Madhya Bharat High Court Indore. in Civil Misc. Cases Nos. 26 of 54 and 48 of 55. A. V. Viswanatha Sastri, C. B. Agarwala and A. G. Ratna parkhi, for the appellants. R.J. Bhave and 1. N. Shroff, for the respon. dents. July 26. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. ,The appellant, the Indore Iron and Steel Registered Stock holders ' Association (Private) Ltd., is a 'registered Association whose constituent members carry on business generally in fabricated iron and steel material and more particularly in iron sheets, plain or corrugated, bars, rods, light and heavy structurals, nails, joints, wire nails and all kinds and varieties of wirer, and 926 pipes. This business is carried on by the constituent members of the appellant at Indore and Ratlam at which places they have their registered offices. The State of Madhya Bharat, by its Act No. 30 of 1950, imposed sales tax in the territory of Madhya Bharat on the sales of goods therein specified with effect from May 1, 1950, and under the provisions of the said Act the Commissioner of Sales Tax, Madhya Bharat, and the, Sales Tax Officer, Indore, who are respondents 2 and 3, were appointed authorities for the assessment of tax leviable under the Act and for its recovery in their respective areas. Section 3 of the Act is the charging section and it provides for the incidence of taxation, Section 4, which deals with the application of the Act exemption and exclusion, provides by Sub section (2) that no tax shall be payable under the Act on the sale of goods specified in the second column of Sch. 1 on conditions mentioned in column 3 of the Schedule. " 'Iron and steel" appears in, Sch. 1 as item 39. Section 5 prescribes the rate of tax and it provides that the tax will be recoverable as notified from time to time by the Government by publication in the official gazette subject to the condition that it shall not be less than Rs. 1 9 0 per cent or more than 61 per cent. Section 4(3) authorises the Government by notification to modify Sch. 1 from time to time. Similarly section 5(2) authorises the Government while notifying the tax payable by a dealer to notify the goods and the point of their sale at which the tax is payable. It is by virtue of this delegated power that the State 'Of Madhya Bharat, respondent 1 purported to issue notifications to which we will presently refer. On May 22, 1950. a notification was issued under section 5(2) specifying serially the articles taxed, 'the stage of sale by traders in Madhya Bharat on which the tax is levied and the rate of sales tax per cent. Item 27 in the list dealt with goods manu 927 factured from things (wastu) except gold and silver or goods manufactured from more than one metal (except circles and sheets of copper, brass and aluminium). The notifications provided that the tax had to be paid by the producer or importer at that rate of Rs. 3 2 0 per cent. Meanwhile article 286(3) of the Constitution had come into force. This Article as it then stood provided that no law made by the Legislature of a State imposing, or authorising the imposition of, a tax on the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community, shall have effect unless it has been reserved for the consideration of the President and has received his assent. Thereafter Parliament by law proceeded to make the declaration as contemplated by this Article by section 2 of Act 52 of 1952 [Essential Goods (Declaration and Regulation of Tax on sale or purchase) Act] (hereafter called the Act) which was passed on August 9, 1952. Section 2 of the Act provides that the goods specified in the Schedule are hereby declared to be essential for the life of the community. Item 14 in the Schedule refers to ,iron and steel '. Thus, as a result of these provisions in on and steel came to be declared as essential for the life of the community within the meaning of article 286(3) as from August 9, 1952. Respondent 1 thereupon purported to give effect to the provisions of article 286(3) and section 2 of the Act by issuing two notifications on October 24, 1953. By the first notification it was provided that no tax shall be payable enter alia on the sale of iron and steel. 'Iron and steel ' was placed at item 39 in the said Schedule. The other notification issued on the same day by item 9 in the list provided for the sale of the articles specified in the said item. This item reads thus: 928 Every kind of metal including copper brass, manganese, zinc, lead, mercury, bronze, nickel, aluminium, tin and their ore form (ex cluding iron, steel, gold and silver) and goods prepared any metal other than gold and silver, utensils and wires, goods prepared from one ore more than one metal, utensils and wires which also includes mangars, metal pieces and scraps, cutting and lantern, gas, stove and type letters (excluding circles and sheets of copper, bra,% and aluminium). " It is common ground that under this notification the articles in which the constituents of the appellant deal would be liable to pay the sales. tax in question. After this notification was issued the appellant wrote to respondent 3 claiming exemption from payment of sales tax for the goods and articles in which its constituent members are dealing but this plea was rejected by the said respondent, and the constituent members of the appellant were called upon to pay sales tax each in respect of their individual turnover. It was under these circumstances that the appellant filed two writ petitions under article 226 of the Constitution in the High Court of Madhva Bharat at Indore in which it challenged the validity of the assessment orders passed for the two years 1953 54 and 1954 55 respectively (Petitions Nos. 26 of 1954 and 48 of 1955). The appellant 's case was that the articles in which the constituent members of the appellant dealt were covered by the parliamentary declaration contained in section 2 of the Act and as such were no longer liable to pay sales tax. This plea was resisted by the respondents. It was urged on their behalf that the notification issued by respondent 1 on October 24, 1953 was valid, and item 27 in the list notified brought the articles in question within the mischief of the Sales Tax Act and so the petitioners were not entitled to any writ as claimed by them. The High Court has upheld the plea 929 raised by the respondents, rejected the contentions urged by the appellant and has dismissed the ' writ petitions filed by it. It is against these orders of dismissal passed by the High Court in the two writ petitions filed by the appellant that the present appeals, No. 509 and 510 of 1960, have been brought to this Court by special leave granted by this Court. Two points have been urged before us by Mr. Viswanatha Sastri, on behalf of the appellant, in support of these appeals. It is urged that section 2 of the Act which contains the parliamentary declaration as contemplated by article 286(3) covers iron and steel as understood in their commercial sense. The words "iron and steel" should not be interpreted in their narrow dictionary meaning. They do not mean iron and steel as they come out after smelting but they mean articles exclusively made from iron and steel in which the identity of iron and steel has not been lost. In other words, iron and steel in the context mean all articles made exclusively of iron and steel in which steel merchants normally and generally trade. It is further argued that in construing the words " 'iron and steel" we must bear in mind the fact that the object, of article 286(3) is to safeguard the 'interest of the consumer in regard to the articles which Parliament may declare to be essential for the life of the community, and it is suggested that if the narrow dictionary meaning of the words is adopted it would not serve the said object and purpose of the constitutional provision. Mr. Sastri has also relied on what he has described as the legislative history which indicates that the said words should receive a broad and wide construction in the context. In that connection he has invited our attention to the provisions of ' section 2(d), section 3. and the categories specified in the Second Schedule to the Iron and Steel 930 (Control of Production and Distribution) Order, 1941. , These categories, according to Mr. Sastri unmistakably support his argument that the expression ",iron and steel" as used in the order was obviously used in a very wide and broad sense. Similarly, he has referred to the provisions of section 2(a)(vii) of Act XXIV of 1946 [The Essential Supplies (Temporary Powers) Act, 1946] and section 2(a)(vi) of Act 10 of 1955 (The ). His contention is that it would be legitimate for the Court to consider the legislative history in the matter of the use of these words and their denotation, and that the legislative history to which he has referred supports his argument that the words ',iron and steel" should receive a very liberal interpretation in determining the effect of the provisions of section 2 of the Act. The High Court Was not impressed by this argument. It has held that the words "iron and steel" as used in Entry 14 to Sch. 1 of the Act do not include within their ambit articles made of iron and steel such as those with which we are concerned in the present proceedings. Mr. Sastri seriously questions the correctness of this conclusion. It is clear that even if we were to accept Mr. Sastri 's contention in regard to the denotation of the words ",iron and steel" as used by the relevant provisions of the Act it would still have to be shown by the appellant that the impugned notification is invalid because it contravenes the provisions of article 286(3). In other words, in order to succeed in the present appeals the appellant has to prove two facts, (1) that the words ""iron and steel" in respect of which the requisite parliamentary declaration has been made by section 2 of the Act include commodities like those with which we are concerned, and (2) that the impugned notification contravenes article 286(3). It would thus be seen that unless the appellant succeeds in both these contentions the appeals are bound to fail. Since 931 we have reached the conclusion that even on the assumption that the parliamentary declaration made by the relevant provision of the Act includes commodities with which we are concerned is correct it does not follow that the impugned notification contravened article 286(3) we do not propose to deal with the first point raised by Mr. Sastri. In dealing with these appeals we would assume in hip, favour that the words "iron and steel" should receive the broad and wide interpretation for which he contends. Assuming then that the articles in which the constituents of the appellant deal are covered by the parliamentary declaration made by the Act does it follow that the impugned notification contravenes article 286(3) ? That takes us to the provisions of article 286(3) which we have already cited. This provision can be successfully invoked only if three conditions are satisfied. The first condition is that the impugned law must be one which is made by the Legislature of a State which obviously means a State which came into existence under and after the Constitution ; and that shows that the impugned law must be a law made by the Legislature of a State subsequent to the Constitution. This condition is satisfied in the present case because the impugned notification has been issued by virtue of the authority delegated to respondent 1 by Act 30 of 1950 and this Act was passed after the Constitution was adopted. Let us then consider the second condition which is also in the nature of a condition precedent. This condition requires that the impugned law must impose or authorise the imposition of a tax on the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community. There can be little doubt that this condition postulates that at the time when the impugned law is passed there is a [1962] preexisting declaration made by Parliament in regard to the essential character of a commodity. The material words in respect of this condition are that the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community. Therefore, if the parliamentary declaration follows the impugned enactment it cannot retrospectively affect the validity of the said enactment. Article 286(3) contemplates that if in the face of an existing parliamentary declaration about the essential character of a commodity the Legislature of a State purports to impose or authorise the imposition of a tax on such commodity the enactment would be invalid unless the law made by the Legislature has been reserved for the consideration of the President and has received his assent. The third condition emphasises that the impugned law must have been passed subsequent to the Constitution, because unless the relevant provision of the Constitution for the reservation of the law for the consideration of the President has come into force this condition cannot apply. This requirement obviously means that the office of the President must have come into existence and so this condition can become operative only after the Constitution has come into force. Therefore, the third condition supports the conclusion which arises from the words used in the first condition itself. Thus the position is that Act 30 of 1950 satisfies the first condition but not the second. It is conceded that the relevant provisions of the M. B. Act of 1950 authorise the, imposition of tax on the commodities in question and that the impugned notification is otherwise consistent with, and justified by, the said provision of the Act. Now, if the said M. B. Act authorises the imposition of tax on the goods in question and the said goods were not declared by Parliament by law to be 933 essential for the life of the community before the date of the said: Act its validity cannot be challenged on the ground that it was not reserved for the consideration of the President and ha not received his assent. It is only when all the conditions prescribed by article 286(3) are present that the validity of the impugned law can be successfully challenged. The question about the construction of article 286(3) has been considered by this Court on two occasions. In Sardar Soma Singh vs The State of Pepsu and Union of India(,), section R. Das, J., as he then was, who spoke for the Court has observed that it is quite clear that section 3 of Act 52 of 1952 does not affect the Ordinance there challenged for the said Ordinance was not made after the commencement of the Act, and that article 286(3) contemplates a law which can be but has not been reserved for the consideration of the ' President and has not received his assent. This position clearly points to post constitutional law for there can be no question of an existing law continued by article 372 being reserved for the consideration of the President for receiving his assent. This decision supports the conclusion that the law contemplated by the first condition specified in article 286(3) must be post constitutional law. To the same effect are the observations made in the majority judgment of this Court in Firm of A. Gowrishankar vs Sales Tax Officer, Secunderabad (2). In this connection it would be relevant to refer to section 3 of the Act itself. It provides that no law made after the commencement of this Act by Legislature of a State imposing or authorising the imposition of t tax on the sale or purchase of any goods declared by this Act to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his (1) ; (2) A.I.R. 1958 S.C. 883. 934 assent. This provision also shows that the declaration made by the Act was intended to be prospective in operation and it would affect laws made after the commencement of the Act, and that clearly must mean that if a law had been passed prior to the commencement of the Act and it authorised the imposition of a tax on the sale or purchase of certain commodities its validity cannot be challenged on the ground that the said commodities have been subsequently declared by the Act to be essential for the life of the community. The impugned notification with which we are concerned and the Act under which it has been issued are thus outside the purview of section 3 of the Act. That in substance is the finding made by the High Court on the second contention raised before it by the appellant. In our opinion, the conclusion of the High Court on t is point is right. In the result the appeals fail and are dismissed with costs. Appeals dismissed.

The constituent members of the appellant Association, who carried on business in iron and steel articles were assessed to sales tax for the years 1953 54 and 1954 55 under a notification dated October 24, 1953, issued by the State of Madhya Bharat under section 5(2) of the Madhya Bharat Sales Tax Act, Samvat 2007, (Act No. 30 of 1950). The appellant moved the High Court under article 226 of the Constitution challenging the validity of the assessment on the ground that the said articles were covered by the declaration made by Parliament by section 2 of the Essential Goods (Declaration and Regulation of Tax on Sale or Purchase) Act, 1952, that iron and steel were essential commodities within the meaning of article 286(3) of the Constitution which was operative from August 9, 1952. The High Court found against the appellant. Held, that even assuming that the words "iron and steel" in Entry 14 of the Schedule to the Act were comprehensive enough to include articles made of iron and steel, that would not necessarily render the notification invalid under article 286(3) of the Constitution. Article 286(3), as it stood before the Constitution (Sixth Amendment) Act, 1956, could be successfully invoked only if three conditions were satisfied, (1) that the impugned legisla. tion was one by the Legislature of a State, constituted under the Constitution, (2) that it was subsequent to the declaration made by the Parliament as to the essential character of the commodity and (3) that it could be, but was not, reserved for the President 's consideration and assent. It was obvious, therefore, that a subsequent Parliamentary 925 declaration could not affect the validity of an enactment retrospectively. Sardar Soma Singh vs The State of Pepsu and Union of India, ; and Firm of A. 'Gowrishankar vs Sales Tax Officer, Secunderabad, A. I. R. , referred to. Although the Art, tinder which the impugned notification was made, satisfied the first condition, it did not satisfy the second or the third and, consequently, its validity could not be questioned under article 286(3) of the Constitution. Held, further, that it was apparent from section 3 of the Essential Goods (Declaration and Regulation of Tax on Sale or Purchase) Act, 1952, that if a law had been passed prior to the commencement of the Act authorising the imposition of a tax its validity could not be challenged on the ground that the said commodity was subsequently declared by the Act to be essential for the life of the community. The impugned notification and the State Act under which it was made were, therefore, outside the purview of section 3 of the Act.

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.

Appeal No. 171 of 1958. Appeal by special leave from the Judgment and order dated March '7, 1956, of the Punjab High Court (Circuit Bench) at Delhi in Civil Misc. No. 249 D of 1956. WITH Civil Appeals Nos. 172 to 186 of 1958. Appeals from the judgment and order dated August 26, 1954, of the Punjab High Court in Civil Revisions Nos. 243, 274, 276, 277, 281 to 286, 288, 290 and 293 and 295 of 1951. Anoop Singh, for the appellant in Civil Appeal No. 171 of 1958. Basant Kumar Jaggi, for the respondent. (In Civil Appeals Nos. 172 to 186 of 1958). A.V. Viswanatha Sastri, R. Ganapathy Iyer and O. Gopalakrishnan, for the appellants in Civil Appeals Nos. 1722 to 186 of 1958. C.K. Daphtaru Solicitor General of India, C.B. Aggarwala and K.P. Gupta, for the respondent$ Nos: 1 to 4. 949 1961. August 2. The Judgment of the Court ,",as delivered by S.K. DAS, T. These are 16 appeals which have been heard together. For facility of considering them on merits, it would be convenient to classify them into three categories. In the first category fall Civil Appeals Nos. 172 to 184 of 1958. In the second category are two appeals, Civil Appeals Nos. 185 and 186 of 1958. In the third category falls Civil appeal No. 171 of 1958. The appeals in the first two categories arise out of a judgment in revision rendered by the High Court of Punjab at Simla on August 26, 1954. That decision was reported in British Medical Stores vs L. Bhagirath Mal (1). The appeal in the third category arises out of a short order of the said High Court dated March 7, 1956, by which it dismissed an application made by the appellant tenant under article 227 of the Constitution. It appears that the order war, based on the decision given by the High Court in the first two categories of cases. The appeals in the first two categories have been brought to this Court on a certificate granted by High Court, and have been consolidated by an order made by the said Court. Civil Appeal No. 171 of 1958 has been brought to this Court in pursuance of special leave granted by. this Court on November 19, 1956. The reason why these appeals have been put in three categories is this. The judgement of the High Court against which appeals are really directed is the judgment rendered in the first two categories of eases (reported in Messrs. British Medical Stores vs L. Bhagirath Mal (1). That judg ment related to four sets of ' buildings of Chandini Chowk in Delhi. In Civil Appeals Nos. 172 to 186, we are concerned with two of these buildings owned by the landlord Bhagirath Mal, who has since died ,(1) Punjab 639. 950 and is now represented by some of the respondents. For convenience, however, we shall refer to him as the landlord. The two buildings we are concerned with are called (1) "Chemists ' Market", also known as "Medicine Market", and (2) "Prem Building". Both these buildings are part of a colony called " 'Bhagirath Colony". Several tenants took on rent flats or rooms in the said buildings and the question which fell for determination was the fair and standard rent payable for the said flats or rooms under section 7A of the Delhi and Ajmer Marwara Rent Control Act, 1947, (Act XIX of 1947), hereinafter referred to as the Control Act, 1947. In the first two categories of appeals, the main point for consideration before us is whether the judgment rendered by the High Court on August 26, 1954, was correct, the High Court having held that the whole proceedings taken before the Rent Controller were ultra vires and without jurisdiction. 'The reasons given for this finding by the High Court were not quite the same in respect of the two buildings; somewhat different reasons were given in the cases of the two tenants in the Prem Building. Therefore, it would be convenient to deal with the main judgment of the High Court in Civil Appeals Nos. 172 to 184 of 1958 of the tenants in the building known as "Chemists ' Market". We shall then deal with the special considerations arising in the two appeals preferred by the tenants of the "Prem Building". Lastly, we shall deal with Civil Appeal No. 111 of 1958 which relates to a different building altogether belonging to a different proprietor, namely two ground floor flats of a house on plot No 20, Block No. 13 in Western Extension Area, Karolbagh, New Delhi. shall later state the facts of that appeal, but it is sufficient to state here that the application for fixation of standard rent for the flats in the Karolbagh house was dismissed on the ground that the High Court had held earlier in the first two categories of cases, that section 7A of the Control Act, 1947 was unconstitutional and 951 void after the coming into force of the Constitution of India on January 26, 1950. Civil Appeals Nos. 172 to 184 of 1958 Having made these preliminary remarks with regard to the classification of the appeals, we proceed now to state the facts with regard to the first category of appeals relating to the "Chemists ' Market" in Bhagirath Colony. On July 30, 1948, nine tenants made an application to the Rent Con troller, Delhi, asking for a determination of fair and standard rent of the tenements (shops) rented to them by the landlord, on the ground that under the stress of circumstances which resulted from the partition of the country and scarcity of business premises available in Delhi after partition, they were forced to take on rent the shops in question on an excessive and exorbitant rate of rent charged by the landlord. They alleged that the premises were completed after March 24, 1947, and they were entitled to have the fair and standard rent determined for the shops in question by the rent Controller. On August 1, 1948, the Rent Controller recorded an order to the effect that in order to fix the rent of the shops in question in accordance with section 7A read with Sch. TV of the Control Act, 1947 a summary enquiry would be held on August 18, 1948. A notice was issued to that effect to the landlord, directing him to attend and bring all relevant authenticated records such as plans, account books, vouchers etc., showing the cost of construction of the building; the landlord was also asked to bring documentary evidence relating to the date of completion of construction of the building. It is necessary to explain here why the date of completion of construction of the building was important. The Control Act, 1947 came into force on March 24, 1947. By section 1(2) thereof, as it originally stood, it was not applicable to any premises the construction 952 of which was not completed by March 24, 1947, and which was not let to a tenant before the enforcement of the Act. Later, there was an Ordinance (Ordinance No. XVIII of 1947) followed by all Act (Act L of 1947)by which enactment only constructed buildings were brought within the purview of the Control Act, 1947 by repealing section 1(2) of the Act in so far as it affected buildings iii. Delhi and by introducing s,7 A and Sell. IV to the Act. We shall presently read section 7 A and the relevant provisions of Sch. We may just state here that s.7A laid down that the fair rent of the constructed buildings shall be fixed according to the provisions set forth in Sch. Buildings which were completed earlier than March 24, 1947, had to be dealt with by the Civil Court under s.7 of the Act. Under s.7A read with. IV, the Rent Controlled had jurisdiction to fix the, fair and standard rent in respect of buildings which were not completed before the commencement of the Act. Therefore, the Rent Controller had to determine the date of completion of the building, in order to have jurisdiction under s.7A of the Control Act, 1947. We have referred to the notice which the Rent Controller had directed to be issued to the landlord on August 12, 1948; fixing August, 18 1948, as the date for the hearing of the case. On August 18, the landlord made an application by means of a letter sent to the Rent Controller in which he, asked for postponement of the case to some date in September. The case was postponed to August 26, 1948, but on that date the landlord again asked for an adjournment. Then on September 1, 1948, an application was made on behalf of the landlord, in which there was a reference to 14 tenants who had applied for fixation of standard rent for the shops in the Chemists ' Market. In this application the landlord stated that he himself had applied for fixation of 953 standard rent under section 7 of the Control Act, 1 947 in the Court of the Subordinate Judge, Delhi and as those applications were pending, he prayed that the proceedings for determining the identical question of fixation of standard rent by the Rent Controller tinder s.7A should be stayed. The printed record does not clearly show how and when tenants other than the 9 tenants who had originally applied for fixation of standard rent on July 30, 1948, had also applied for fixation of standard rent for the shops in their occupation. It is clear, however, from the application of, the landlord dated September 1, 1948 that 14 tenants including some of those who had applied on July 30, 1948 had applied for fixation of standard rent for the shops occupied by them. On November 9, 1948, the Rent Controller wrote a letter to the landlord in which he referred to some enquiry held in his officer on September 1, 1949 and said:. "On that day you promised to produce some papers to show that these shops were completed before March 24, 1947. As the case is unnecessarily being delayed, you are requested to appear in my office with all the necessary document at 3 P.m. on Wednesday the 17th November, 1948. It may please be noted that no further adjournment will be possible. Your failing to comply with this notice, ex parte decision will be given". On November 15, 1948 the Rent Controller again wrote to the landlord that on a representation by the landlord 's representative, the date had been extended to November 19, 1948 and the landlord should produce all necessary documents relating to the building in quest ion. The Rent Controller again reminded the landlord that there would be a final hearing on November 19. On that date, however, the landlord again made an application saying that as there were regular suits for the determination 954 of the standard rent pending in the Court of the Subordinate Judge, Delhi, the proceedings before the Rent Controller should be stayed. On November 26, 1948 the Rent Controller wrote to the landlord to the following effect: " 'As you have failed to attend my office personally on the fixed date and your attorney did not possess any information or documents regarding the newly constructed "Chemists ' Market", you are now directed to submit your written statement on oath, duly countersigned by your advocate, giving full details regarding the date of construction of the said building. Please note that your statement must reach this office before the 3rd December 1948". Then on December 3, 1948 the Rent Controller wrote to the landlord saying that he would be visiting the premises on December 5, 1948. On December 3, a telegram was sent on behalf of the landlord saying that lie was out of station. On that date the Rent Controller recorded the following order: "These shops were first let out from 1st April, 1948. The Advocate for the landlord was requested to tell the landlord that he must submit his statement in writing (countersigned by the. Advocate) within the next 15 days whether he contends or does not contend that this building was completed after 24th March, 1947. The Advocate for the landlord gave an application asking for staying the proceedings as he had applied to the Sub Judge for fixa tion of standard rent of the premises. He was told that I was not prepared to stay the pro ceedings unless he or his client were prepared to say on oath that the building was completed before the 24th March, 1947. " 955 On December 9, 1948 the Rent Controller again wrote to the landlord to the following effect: " I am in receipt of your telegram dated the 3rd December, 1948. On 19th November, 1948, the last date of hearing, your Advocate Shri Jugal Kishore and your General Attorney Shri Kundal Lal were given definite instruction to see that your written statement, as to when the construction of ' the "Chemists ' Market" was started and when completed, was sent to me within 15 days. These instructions were later confirmed in writing vide this office No. R. C. 42/ Camp. dated the 26th November, 1948. My instructions, however, have not been complied with so far and it is presumed that you are try g to evade the issue. I, however, give you another final opportunity and direct you to submit your written ,statement on oath within one week from the receipt hereof, showing the date of completion of construction of ' your building known as "Chemists ' Market" in Bhagiratli Colony, Chandni Chowk, Delhi. Please take notice that your failure to comply with (torn) within the stipulated period will amount to disobeying the orders of this Court and the case will be referred to appropriate authorities for necessary action in the matter. " The landlord took no steps whatsoever to furnish any written statement. In these circumstances, the Rent Controller passed his final order on January 10, 1949. In that order he recited the facts stated above and ended up by saying that though the landlord had been given sufficient oppor tunity, he had not made any statement in writing or 956 otherwise and that the landlord was clearly trying to avoid the trial of the issue. The Rent Controller had inspected the building on December 12. 194S and made local enquiries. He came to the finding that the shops in question were completed only in the beginning of 1948. He said: "I inspected this building on 12th December, 1948 and made local enquiries when it transpired that the building (shops) was com pleted only in the beginning of 1948. The very look of the building also confirms this information. On the other hand, no data has been placedbefore me by the landlord, his attorney or the advocate to show that the construction of the building was completed. before 24th March, 1947. According to the admitted statement of the attorney the shops have been let out for the first time in 1948 and otherwise too his statement of 19th Novem ber, 1948 shows that the building had not been.completed before 24th March, 1947. No completion certificate or house tax receipts have been produced in support of this conten tion. It is, therefore, not understandable how it is claimed that the shops were comple ted before 24th March, 1947. The owner is knowingly avoiding to give a statement himself that the shops were completed before 24th March, 1947. Evidently because he realises that this is not true. It has also not been stated what use was made of these shops till January, 1948, when they were first let out if they had been completed before 24th March, 1947 as alleged. It is unbelievable that shops like these could remain unoccupied for nearly 9 to 1.0 months after completion. I am, therefore, convinced beyond a shadow of doubt that the construction of there shops was completed long after 24th March, 1947, and the fixation 957 of their standard rent definitely falls within the scope of section 7 A of the Delhi and Ajmer Marwara Rent Control Act, 1947(as amended). I,therefore, proceed to fix the rent accordingly. " After taking into consideration the nature of the construction and the fittings, etc., and other relevant considerations the Rent Controller fixed the valuation at Rs. 9 7 0 per sq. ft. of plinth area for working out the probable cost of the construction of the building. The cost of the land, he estimated at Rs. '275 per sq. ; but he allowed only one third of the estimate inasmuch as the building was one storeyed and all the buildings in the vicinity were mostly three storeyed. On these calculations, lie held that the standard rent for all the shops in the building work out at Rs. 335 per month including 10% for repairs but excluding house tax and charges for consumption of water and electricity. A calculation sheet was prepared fixing the standard rent for each of the shops including some shops which were vacant, oil the aforesaid ' basis. The calculation sheet showed that the standard rent of 18 ,shops in the building varied from Rs. 10 per month to Rs. 50 per month. Against the order of the Rent Controller dated January 10, 1949, nineteen appeals were taken to the District Judge. One of the points taken before the District Judge was that the Rent Controller had no jurisdiction to fix the standard rent inasmuch as the building had been completed before March 24, 1947. The learned District Judge dealt with this point at length, and held that the Rent Controllers finding on the question of jurisdiction was correct. As to fair rent, he held that though the building was single storeyed, there was no reason why the landlord should not be allowed the full value of the land on which the building. stood. Allowing full value for the land and having regard to the rent of premises in the neighbouring area the learned 958 District Judge modified the order of ' the Rent Controller and fixed the standard rent of the building at Rs. 670 per month, viz., double. of what was fixed by the Rent Controller. The learned District Judge passed his order on January 15, 1951. It appears that from the order of the District Judge, Delhi dated January 15, 1951, certain applications in revision were. made to the Punjab High Court. Most of the applications were by the landlord, but one of them was by a tenant. These applications were heard together by the High Court. The High Court allowed the applications of the landlord and held in effect that the proceedings before the Rent Controller violated the principles of natural justice and were, therefore, bad and without jurisdiction. The High Court, it appears, travelled over a wide field and dealt with a number of questions, though its decision was based on the finding stated above. The first question which the High Court considered was whether s.7A read with Sch. IV of the Control Act, 1947 prescribed a discriminatory procedure without a reasonable classification in respect of premises completed after March 24, 1947 and thus violated the guarantee of equal protection under article 14 of the Constitution. Along with this question was canvassed another connected question viz., whether these cases would be governed by the law in force at the time of the decision given by the Rent Controller or by the law existing at the time when the District Judge heard the appeals. It may be here noted that the Constitution of India came into force on January 26, 1950 and at the date of decision of the Rent Controller article 14 of the Constitution was not in force. The High Court expressed the view that the law to be applied was the law in existence at the time when the District Judge decided the appeals. It further held that section 7A read with Sch. IV of the Control Act, 1947 was violative of the guarantee of equal protection 959 of laws under article 14 of the Constitution, there being no rational nexus between the classification made regarding premises old and new and the objects of the statute. Having given these two findings, the High Court said, however, that it would prefer not to base its judgment on these findings, because to do so might be giving retrospective effect to the Constitution. The High Court then went, on to consider the further contention urged before it that in the proceedings before the Rent Controller there was a violation of the principles of natural justice inasmuch as all recognised principles governing tribunals which exercise quasi judicial powers or follow a procedure subserving the orderly administration of justice had been. disregarded. On this point the learned Judge, delivering the judgment of the Court, expressed himself as follows "In the present case no 'evidence as to rent was called from the parties or recorded by the ' Controller nor was any opportunity afforded to the parties to adduce such or any evidence which they considered necessary to submit. The Controller made private enquiries and his order shows that he has based his decision on the cost of the building which he himself calculated without allowing the petitioner an opportunity to show that such calculation was wrong or its basis erroneous. Of course, there is no procedure prescribed by the Schedule and whatever procedure was followed does not subserve the orderly administration of justice. So that the, determination is based oil private enquiries, unchecked calculations and no evidence of the parties who were afforded no opportunity of proving their respective cases. " With regard to the flats in 'Prem Building 'a farther ground given by the High Court was that they were, 960 not now construction as held by the District Judge, and therefore s.7A was not applicable for determination of fair and standard rent in respect thereof. We may first dispose of the constitutional point that s.7 A read with Sch. IV of the Control Act, 1947 violated the fundamental right guaranteed under. article 14 of the Constitution. We may 'here read s.7A and some of the provisions of Sch. "7A. The provisions set out in the Fourth Schedule shall apply to the fixation of rent and other matters relating to the premises in Delhi (hereinafter referred to as the newly constructed premises) the construction of which was not completed before the commencement of this Act. The Fourth Schedule 1."Rent Controller or the purposes of this Schedule means the person appointed by the Central Government as the Rent Controller. 2.If the Rent Controller on a written complaint 'or otherwise has reason to believe that the rent of any newly constructed premi ses is excessive, he may, after making such inquiry as he thinks fit proceed to fix the standard rent thereof. 3.The Rent. Controller in fixing the standard rent shall state in writing his reasons therefor. 4.In fixing the standard rent the Rent Controller shall take into consideration all circumstances of the case including any amount paid or to be paid by the tenant by way of premium or any other like sum in addition to rent. 961 5 and 6. x x x x x 7.For the purposes of an inquiry under paragraphs 2, 5 and 6, the Rent Controller may (a)require the landlord to produce any book of account, document or other information relating to the newly constructed premises, (b)enter and inspect such premises after due notice, and (e)authorise any officer subordinate to him to enter and inspect such premises after due notice. 8 to 10. x x x x x 11. Any person aggrieved by an order of the Rent Controller may, within thirty days from the date on which the order is communicated to him, appeal to the District Judge, Delhi. " This very question was considered by a Full Bench of the same High Court in a later decision (see G. D. Soni vs section N. Bhalla(1). In that decision the High Court went into the entire history of legislation with regard to the control of house rent in both old Delhi and New Delhi from 1939 onwards when the second world war broke out. The High Court pointed out that the New Delhi House Rent Control Order, 1939 made under r. 81 of the Defence of India Rules was the first Control Order seeking to control rent of houses in New Delhi and the Civil Lines. From 1939 till 1942 no Rent Control Act applied to the municipal area of Delhi. On October 16, 1942 the Punjab Urban Rent Restriction Act, 1941 with suitable adaptations was extended to that area. Under that Act a landlord could recover only standard rent from the tenant and the term "standard rent ' was defined as meaning the, rent at (1) A I.R. 1959 Punj. 381. 962 which the premises were let on January 1, 1939 and if not so, the rent at which the were last let. In cases not governed entirely by this definition, the Court was given the power to fix standard rent. In 1944 the then Governor General promulgated the Delhi Rent Control Ordinance, 1944. Under this Ordinance the Chief Commissioner could apply it to any area within the Province of Delhi and whenever the Ordinance was made applicable to any area, the Punjab Urban Rent Restriction Act, 1941 ceased to be operative. In the Ordinance also standard rent was defined substantially in the same terms as in the Punjab Act. The Central legislature then enacted the Control Act, 1947 which repealed the Punjab Act as extended to Delhi and also the Rent Control Order of 1939 and the 1944 Ordinance. By s.1(2) the Act, was made inapplicable to any premises the construction of which was not completed by March 24, 1947 and under s.7 of the Control Act, 1947, at Court in case of dispute had to determine the standard rent on the principles set forth in the Second Schedule. We have already stated earlier that s.1 (2) of the Control Act, 1947 was later repealed (so far as, it affected buildings in Delhi), and newly constructed buildings were brought within the purview of the Control Act, 1947 by introducing s.7A and Schedule, IV to it. From this brief survey of the legislative history of the control of rent of premises situated in the Province of Delhi, it is clear that the Control Act, 1947 brought about uniformity in the law relating to rent control by laying down that the standard rent of newly constructed premises shall be fixed by the Rent Controller while the Court will fix the standard rent in respect of other premises. There is no doubt that a classification was made between premises the construction of which was, completed before March 24, 1947 and those the construction of which was completed after that date. The question is whether this classification is based on 963 intelligible differentia having a rational nexus with the objects of the statute. Dealing with this question Bishan Narain, J. delivering the judgment of of Full Bench said: 'The learned counsel for the landlord challenged the validity of these provisions on the grounds (1) that there is no reasonable basis for fixing the standard rent of newly constructed premises differently on a different principle from the principle on which standard rent is fixed for old buildings in the same locality and (2) that there is no reason for discriminating against the landlords of newly constructed buildings by laying down that their standard rent shall be fixed by Rent Controllers appointed by the Central Government while the standard rent of other buildings is to he fixed by courts of law which are bound to follow procedure laid down in the the Civil Procedure It is urged that the Rent Controller is not bound by any procedures laid down by the Civil Procedure Code or the Punjab Courts Act. x x x Section 7 says that the standard rent shall be determined in accordance with the principles set forth in the Second Schedule. The Second Schedule fixes basic rent as determined tinder the Control Order of 1939 or under the 1944 Ordinance and in other cases the contractual rent on 1 11 1939 or if not on that day then on the date first let after 1 11 1939. The standard rent thus fixed is to be increased by certain percentage specified in the Schedule. If the premises were let after 2 6 1944 then the basic rent and the standard rent were to be the same. Obviously this principle for fixation of standard rent could not possibly have any application to premises constructed and let after 964 24 3 1947. Section 7 then proceeds. to lay down that if for any reason it is not possible to determine the standard rent of any premises set forth in the Second Schedule then the courts shall determine it having "regard to the standard rent of similar premises in the same locality and other relevant considerations". Para 4 of Schedule IV lays down In fixing the standard rent the Rent Controller shall take into consideration all the circumstances of the case including any amount paid or to be paid by the tenant by way of premium or any other like sum in addition to rent. ' It was argued on behalf of the landlord that the critera laid down in s.7(2) and para 4 of Schedule IV of the Act is substantially different and that there is no valid reason for such a differentiation. He urgent that the Rent Controller (1) may ignore the standard rent of similar premises in the same locality while he is under an obligation to take into consideration any amount Paid or agreed to be paid by the tenant by way of premium etc. in addition to rent and that the Rent Controller (2) cannot interfere with the agreed rent unless he finds it excessive and in that he can only reduce the rent fixed between the parties and cannot increase it. It; is urged that under section 7(2) it is open to the Court to increase the standard rent and also not to take into consideration any amount paid by the tenant as premium in addition to rent. Now the Rent Controller is enjoined by para 4 to take into consideration all the circumstances of the case when fixing standard rent. It is not understood how a Rent Controller can omit to consider the standard rent of similar premises in the same locality. This is obviously a relevant consideration though para 4 does not specifically mention it. It is true that this criteria has been 965 specifically mentioned in s.7(2)of the Act and has not been so mentioned in s.7A.but. this circumstance cannot lead to the inference that it is open to the Rent Controller to ignore it. The words of para 4 are in fact as.wide in effect as the words used in s.7(2) of the Act. In this context it must not be forgotten that if such a mistake is made by the Rent Controller then the aggrieved party (may he be landlord or the tenant) can appeal to the District Judge whose powers are co extensive with those of the Rent Controller and who can set right any mistake made by the Rent Controller. I am, therefore, of the opinion that the criterion laid down for fixation of standard rent in s.7(2) and para 4 is substantially the same in scope and is not different. x x x x x Undoubtedly under Schedule: IV the Rent Controller can fix standard rent only if he finds that the rent agreed upon between the parties is excessive. This provision is to protect the landlord from frivolous applica tions by tenants and it is not clear why a landlord should object to this provision. The reason for this provision is intelligible. It is. well known that rents in Delhi prior to 1 11 1939 were very, low and in some cases uneconomic. Therefore the legislature decided that in such cases a landlord should be. in a position to, got standard rent fixed at a rate higher than fixed by agreement of the parties in 1939 or earlier. No such consideration arises in the 'case of buildings constructed. or completed after 1947. In 1947 there existed an acute shortaae of accommodation in Delhi and the landlords were in, a position to dictate terms and, there fore, presumably the fixed between the parties were not so low as to require, in 966 considered unnecessary to provide for increase of rent in Schedule IV. I am, therefore, of the opnion that it is not possible on these grounds to hold that s.7 A and Schedule IV are unconstitutional. The learned counsel then brought to our notice two other matters in which the newly constructed buildings have been treated differently from the old buildings. He pointed out that under para 10(2) of Schedule IIV the standard rent fixed by Rent Controller must necessarily be retrospective in effect while under s.7(5) the Court can fix the date from which the payment of Estandard rent would become effective. He further pointed out that under section 4(2) a landlord on making improvements can increase the standard rent by an amount not exceeding 61 per cent of the cost of improvement, while under para 6 of the Schedule IV the Rent Controller can increase the standard rent in such circumstances to an amount not exceeding 7 1/2 per cent of the cost of improvement. These are, however, no grounds for hold. ing the impugned provisions to be unconstitu tional. ' The Delhi and Ajmer Marwara Rent Control Act, 1947, came into force on 24 3 1947 originally for two years only and s.7 A with Schedule IV were introduced in September 1947. Therefore the standard rent for new buildings could well be fixed from the beginning of the lease. The old buildings were let long before 1947 and, therefore, it was considered advisable to leave it to courts to fix the date from which the payment of standard rent would become effective. This is a rational difference. So is the Matter of differenace of return on the cost of 967 improvements. There is no reason for equating the return on cost of improvements of old buildings with the return oil ' the cost of improvements of new buildings. This is a matter for the legislature to consider and this possible slight difference, in returns cannot be said to be discriminatory and violative of Article 14 of the Constitution. For these reasons I am of the opinion that the criteria for the fixation of standard rent for new and old buildings is substantially the same and does not violate Article 14 of the Constitution and there is no valid reason for coming to the conclusion that the standard rent of old and new buildings of the same type and in the, same locality would necessarily be different. The first ground, therefore, fails and rejected. The second ground also has no force. It is urged that in Schedule TV there is no provision for recording the evidence of the parties nor is it laid down whether the evi dence is to be on oath. It is futher urged that the principles of natural justice have been disregarded by Schedule IV and it is open to the Rent Controller to fix standard rent arbitrarily without recording any evidence. Now para 2 Schedule IV says that the Rent Controller shall make such enquiry as he considers fit to fix the standard rent. x x x x x In fixing standard rent the Rent; Controller decides a dispute between a landlord and a tenant. To do this effectively he has to take evidence and to hold a judicial inquiry particularly when he has to give reasons for his decision. Para 7 is also indicative of such a judicial. inquiry. There is no reason for Presuming and assuming that the 968 Rent Controller would not hold s a oh an inquiry. If he does"not do go then the aggrieved party can always appeal to the District Judge, Delhi who invariably is a very senior and experienced judicial officer. x x In this context it must not be forgotten that considering the ' recent rise in prices of land, building material and labour costs in Delhi the standard rent should be correlated to these costs. In the circumstances the legislature in its wisdom has thought fit that the enquiry, into standard. of new building should continue to remain with the Rent Controllers who can expeditiously decide the matter. In this context it can be reasonably expected that the Central Government will appoint only those persons as Rent Controllers who can use: their own knowledge and experience to calculate these costs. In these circumstances it cannot be said that the differentiation in the procedure adopted in the statute has no rational relation to the, object sought 'by the legislature. We agree with these observations of the Full Bench, and we further accept the view expressed by it that the criteria for the fixation of standard rent for both new and. old buildings under the Control Act, 1947 are not substantially different. The minor differences that exist in the matter, which have been adverted to in the judgment of the High_ Court, can be justified on the grounds of (a) difference in the. cost of construction of old and new buildings, (b) difference in the rate of return on investments made in building houses before and after 1947(c) the need to encourage the, building of houses to meet the acute shortage of 969 accommodation in Delhi after 1947, and (d) the opportunity presented of charging excessive tent after 1947. Perhaps, it is also necessary to emphasise again that the provisions in Schedule IV of the Control Act, 1947, do not give an arbitrary power to the Rent Controller. Paragraph 3 of the. Schedule requires the Rent Controller to state 'in writing his reasons for fixing the standard rent. Paragraph 4 states that in fixing the standard rent, the Rent Controller shall take into consideration all the circumstances of the case including any amount paid or to be paid by the tenant by way of premium or any other like sum in addition to rent. Paragraph 7 gives the Rent Controller power to require the landlord to produce any book of account, document or other information relating to the newly constructed premises, to enter and inspect such premises after due notice, and to authorise any officer subordinate to him to enter and inspect any such premises after due notice. Paragraph. II provides for an appeal to the District Judge by any person aggrieved by an order of the Rent Controller. These provisions clearly indicate that the power given to the Rent Controller is not an arbitrary power. The power has to be exercised by the Rent Controller on a judicial consideration of all the circumstances of the case. We think that the High Court was in error in the view it expressed that no reasonable procedure is prescribed by the provisions of Schedule IV and the Rent Controller is at liberty to do whatever he likes. This brings us to the main question for decision in these appeals was there a violation of the principles of natural justice in the procedure which the Rent Controller actually followed in fixing the standard rent ? 'We are unable to agree with the High Court that there, was any. such violation. On behalf of the landlord, it has been contended before us that in respect of both the matters 970 completion of construction of the building and fixation of standard rent, the Rent Controller proceeded on (i) private enquiries, (ii) local inspection without notice, and (iii) inadmissible evidence. Before we deal with this argument, it is necessary to say a few words about the principles of natural justice. This Court considered the question in New Prakash Transport Co., Ltd. vs New Suwarna Transport Co., Ltd. (1). After a review of the case law on the subject, it pointed out that the rules of natural justice have to be inferred from the nature of the tribunal, the scope of its enquiry and the statutory rules of procedure laid down by the law for carrying out the objectives of the statute. The mere circumstance that the procedure prescribed by the statute does not require that evidence should be recorded in the manner laid down for ordinary courts of law does not necessarily mean that there is a violation of the principles of natural justice. In Union of India vs T. R. Varma (2) this Court said "Stating it broadly and without intending it to be exhaustive, it may be observed that rules of natural justice require that a party should have the opportunity of adducing all relevant. evidence on which he relies, that the evidence of the opponent should be taken in his presence, and that he should be given the opportunity of cross examining the witnesses examined by that party, and that no materials should be relied on against him without his being given an opportunity of explaining them. If these rules are satisfied, the enquiry is not open to attack on the ground that the procedure laid down in the Evidence Act for taking evidence was not strictly followed. " Judged in the light of the observations referred (1) (2) (1958) section C. R. 499) 507. 971 to above, was there a violation of the principles of natural justice in the cases under our consideration? We have pointed out earlier that the landlord was repeatedly given an opportunity of producing such evidence as he wished to produce. On August 12, 1948 be was asked to bring all relevant records including account books, vouchers etc. He did not, choose to do so. He asked for an. adjournment which was granted to him. On September 1, 1948 the landlord again asked for time. This was also granted to him and he was told that the cases would be finally heard on November 17,1948, He was also informed that no further adjournment would be given. It appears from the record that on September 1, 1948 some statements were recorded in the presence of the representative of ' the landlord. On November 19, 1948 which ",as the date fixed for final hearing, the landlord again asked for time and time was again granted to him. On December 3, 1948 the landlord was told that the Rent Controller would inspect the house on. Sunday December 5, 1948 between 9 A. m. and 1 P. m. The landlord was asked to be present. On December 3 the Advocate of the landlord was present and was informed that the landlord must submit his written statement in writing within 15 days. The Advocate, however, gave an application for postponement of the cases on the ground that certain proceedings were pending before the Subordinate Judge, Delhi. On December 9, 1948 the landlord was again given one A week 's time to file his written statement and produce such other evidence as he wished to produce. In these circumstances it is difficult to understand how the landlord can complain that there has been a violation of the principles of natural justice and that he had no opportunity of producing evidence or of cross examining the witnesses whose statements were recorded by the Rent Controller. It, is indeed true that the Rent Controller made some local enquiries when he inspected the building on December 12, 1948. If, however, 972 the landlord chose to be absent in spite of repeated intimation to him, he cannot be heard to say that the enquiries were made in his absence and are, therefore, bad. To bold in such circumstances that there has been a violation of the principles of natural justice would be to put a premium on the recalcitrance of a party. Even in the ordinary courts of law, if a party chooses to be absent in spite of notice, evidence is recorded ex parte and the party who chooses to be absent cannot be heard to say that he had no opportunity of being present or of cross examining the persons whose statements were recorded by the court. After all, what natural justice requires is that a party should have the opportunity of adducing all relevant evidence and that he should have an opportunity of the evidence of his opponent being taken in his presence. Such an opportunity was clearly given to the landlord in the present cases. If anybody is to blame for the ex parte order of the Rent Controller, it is the landlord himself. It appears from the order of Rent Controller that the attorney or advocate of the landlord did appear on several dates and even made a statement as. to the letting out of the building in question but. took no other 'part in the proceeding except asking repeatedly for adjournment. The Rent Controller was not far wrong when he said that the landlord was bent upon avoiding a trial of the issue before the Rent Controller on the ground that be had made applications under section 7 to the Subordinate Judge, Delhi, for fixation of ' standard rent. In view of the recalcitrant attitude which the landlord adopted the Rent Controller did his best in the circumstances. He took into consideration such relevant circumstances as the cost of the, land, cost of construction, cost of fittings, the open. area in front of the shops, cost of repairs etc. The learned District Judge also took in to consideration the return which the landlord could:. reasonably expection his outlay and also. the rent of other premises in the. area. Taking these 973 additional circumstances into consideration, the District Judge doubled the standard rent which the Rent Controller had fixed. 'It does, not appear from the order of the learned District Judge that any objection was pressed before him on the ground that in the actual proceedings. before the Rent Controller there was a violation of ' the principles of natural justice, though in paragraph 7 of the grounds of appeal it was stated that the procedure adopted by the Rent Controller was contrary. to the provisions of law etc. A ground appears to have been seriously pressed for the first time I in the revision applications to the High Court. Some grievance has been made before us of the circumstance that in his letter dated December 3, 1948 the Rent Controller said that be would inspect the building on December 5,1948. He however, actually inspected the building oh December 12, 1948 as his order shows. Our attention has been drawn to para 7 (b) of So 'IV and it has been contended that the inspection was made without notice to the landlord '. This, it is stated, has. vitiated the entire proceedings. This argument might have had some force, but for the attitude adopted throughout the proceedings by the landlord. On the very date on which the, Rent Controller intimated to the landlord that he would visit the building on December 5, 1948, the landlord sent a telegram purporting to be on his behalf stating that he was out of, station. The Rent Controller then noted an order on that very date stating that the advocate for the landlord gave an application for staving the proceedings. The application was rightly refused by the Rent Controller. In these circumstances we do not think that the landlord can make any complaint that the inspection was without notice or that he had, no opportunity of being present at the time of the inspection. It is obvious that from the very beginning the landlord had taken up an attitude of non co operation in the proceedings before the 974 Rent Controller. It is worthy of note that even in statement of the case in this Court, the landlord has made No. grievance that the inspection was held without notice to him; nor did he take any such plea before the District Judge. A further contention urged on behalf of the landlord arises out of para 2 of Sch. IV That paragraph says that if the Rent Controller "has reason to believe that the rent of any newly constructed premises is excessive, he may after making such enquiry as he thinks fit, proceed to fix a standard rent thereof". The argument before us is that before proceeding to fix the standard rent the Rent Controller did not bold a preliminary enquiry nor did be record a finding to the effect that the rent charged by the landlord was excessive ; therefore. , the provisions of para 2 were violated. We do not think that there is any substance in this contention. In the, application which 9 tenants made on July 30, 1948 they definitely stated that under the stress of circumstances resulting from a partition of the country and the heavy demand for business premises in Delhi, they were forced to accept the excessive and exorbitant rent which the landlord was charging from them. On this appli cation a note was recorded by the Rent Controller 's office to the effect that the entire case relating to the fixation of standard rent for the building in question was already under consideration, presumably because, other tenants had also made similar applications. The Rent Controller thereupon recorded an order which said that "in order to fix the rent of the premises in accordance with section 7A of the Control Act, 1947 a summary enquiry would be held by him". It is obvious from this order that the Rent Controller was prima facie satisfied that the rent charged was excessive and action was required under s.7A of the Control Act, 1947. The argument urged. on behalf of the landlord really comes to this, viz. that under para 2 of Sch. IV there must always be ' two 975 enquiries, first an enquiry as to whether there are reasons to believe that the rent charged is excessive and, secondly, an enquiry for fixing the standard rent. We do not think that para 2 necessarily involves two enquiries in all circumstances. In a case where the Rent Controller has a written complaint, as in these cases, the complaint itself may give reasons which the Rent Controller may prima facie accept that the rent charged by the landlord is excessive. In the cases before us the tenants had stated the reasons, which were common to all, why they had to submit to excessive and exorbitant rate of rent charged by the landlord. It was, we think, open to the Rent Controller to accept those reasons as prima facie good reasons for proceeding to make an enquiry to fix the standard rent in that enquiry it was open to the Rent Controller to give the necessary finding that the rent charged by the landlord was excessive. The final order of the Rent Controller shows with out doubt that he was satisfied that the rent charged by the landlord was exorbitant and excessive. We are unable to hold that in these circumstances there has been any contravention of para 2 of Sch. IV of the Control Act, 1947. Another objection taken by the landlord to the proceedings before the Rent Controller arises out of the circumstance that the Rent Controller in fixing the standard rent for the entire building had fixed the rent even for vacant shops i.e. shops which were not in occupation of any tenant at the time. In the final order which the Rent Controller passed, he fixed the standard rent for all the shops at RS. 335/ per month and in the calculation sheet, which was part of the final order made by the Rent Controller on January 11, 1949, three shops have been shown to be vacant. It has been contended before us that the Rent Controller had not jurisdiction to fix the standard rent for vacant shops and the argument is that the way he proceeded to fix 976 the rent for the entire building vitiated the proceedings before him. It has further been argued that only 9 tenants, six of whom are appellants before us, applied for the fixation of standard rent on July 30, 1948. Therefore, the Rent, Controller had no jurisdiction to fix the standard rent in respect of persons who had not applied for such fixation. It has been contended before us that in six of the appeals before us (viz. Civil Appeals Nos. 176, 178, 181, 189, 183 and 184 of 1958) the appellants had made no application for fixation of standard rent. We take up first the question of vacant shops. It is clear from s.7A and the provisions of Sch. IV that the Rent Controller has to fix, the standard rent of newly constructed "premises" if the condition stated in para 2 of Sch. TV is satisfied. The word "Premises" as defined in s.2 of the Act means "any building or, part of a building which is, or is intended to be, let separately for use as a residence or for commercial use or for any other purpose etc. " Each shop let out or intended to be let out separately is therefore "premises" within the meaning of the Control. Act, 1947. It may, therefore, be correct to say that it was not necessary for the Rent Controller to fix the standard rent for vacant shops. It is obvious, however, that for shops which had been let out to tenants the Rent Controller had to take into consideration the cost of the entire building, value of the land, the fittings etc. In other words he had to take the entire building into consideration for the purpose of fixing the standard rent of the shops in the building let out to various tenants. That being the position, we do not consider that the proceedings before the Rent Controller were rendered abortive merely because the Rent Controller also fixed the standard rent for some of the vacant shops. For the purpose of these appeals, the standard rent fixed for the vacant shops may well be ignored: that will not 977 affect the rent fixed for the shops which had been let out to tenants. As to the point that some of the appellants had made, no application for fixation of standard rent, we are unable to accept the contention as correct. It is indeed true that 9 tenants had made an application for fixation of standard rent on July 30, 1948, but it appears that there were other applications also from other tenants. This is clear from the office note, to which we have already referred earlier, appended to the application of 9 tenants. Moreover the application which the landlord himself had made on September 1, J948 showed that 14 tenants had made applications for the fixation of standard rent of their shops in Chemists ' Market in Bhagirath Colony. Unfortunately, all the applications have not been printed in the paper book. The order of the Rent Controller shows that he treated all the applications as ' though they gave rise. to a single proceeding, because they related to the same building. This point which has now been taken before us does not appear to have been taken before the District Judge who said that there were 19 appeals before him arising out of a single order of the Rent Controller fixing rent for 18 different shops of a building belonging to the landlord. In the calculation sheets which the Rent Controller and the learned District Judge had prepared and which give the names of all the tenants the standard rent for whose shops was. fixed, are shown the names of all the appellants. It is, me think, too late in the day for the landlord to contend that some of the appellants had not applied for the fixation of standard rent, In any view of the matter, the landlord has not placed sufficient materials before us in support of that contention. We may point out here. that M/s. Narang Medicine Co., appellant in Civil Appeal No. 182 of 1958, did not join in the application made on July 30, 1948. Yet we find from the 978 record that a copy of the letter which the Rent Controller wrote to the landlord on November 9, 1948, was sent to M/s. Narang Medicine Co. As we have earlier pointed out the very petition of the landlord dated September 1, 1948, shows that many more than 9 tenants had applied for fixation of standard rent for their shops in Chemists ' Market, Bhagirath Colony. Therefore, we are unable to uphold the ' contention of the landlord that the Rent Controller had fixed the standard rent of some of the shops, tenants whereof had not applied for the fixation of the standard rent. This concludes the discussion with regard to the Chemists ' Market in Bhagirath Colony. In these appeals we have come to the conclusion, for reasons given above, that the High Court was wrong in interfering with the order of the District Judge in appeal. We would, ;therefore, set aside the order of the High Court dated August 26, 1954 and restore that of the learned District Judge in appeal, so far as the appellants herein are concerned. Civil Appeals Nos. 185 and 186. of 1958. We now turn to the two appeals relating to Prem Building. The two tenants are M/s. Dhawan & Co., and Firm Gokal Chand Madan Chand. M/s. Dhawan & Co. had made ,in application for fixation of standard rent on June 14, 1948. A Similar application was made by Firm Gokal Chand Madan Chand on the same date. In the applications an averment was made that the flats were completed after March 24, 1947, and that the tenants being without any accommodation and under the pressure of circumstances were forced to accept the exorbitant rent of Rs. 360 per month in one case and Rs. 350 per month in the other. Both of them asked for fixation of standard rent under s.7A of the Control Act, 1947. Both the landlord and the tenants appeared before the Rent Controller and 979 made statements before him. The main question taken before the Rent Controller on behalf of the landlord was that the second floor on which the two flats of the tenants were situated ",as completed before March 24, 1947, and therefore, no proceeding in respect thereof was maintainable under s.7A of the Act. The Rent Controller %vent into the evidence adduced before him very carefully and came to the conclusion that though the ground floor and the first floor of the building were old, the second floor was constructed some time. in August, 1947. He, therefore, held that the second floor was a new construction within the meaning of s.7A of the Control Act, 1947 and be fixed the standard rent for each flat at Rs. 96 8 0. The matter wasthen taken in appeal to the District Judge. Again the main contention before the District Judge was that the Rent Controller bad no jurisdiction as the premises in question were not newly constructed. The District Judge dealt with this point in the following way: "The premises, are two flats on the second floor of a large building belonging to the appellant, and the rent Controller has found that these flats were constructed after 24th March, 1947. The record shows that the general attorney for the appellant admitted before the Rent Controller that only a temporary construction was in existence on the second floor before 24th March 1947, and that temporary construction consisted of wooden purlins with corrugated iron sheets and stone slabs on top of them. Subsequently, however, this construction was brought down and proper flats were built with reinforced concrete roofs, and it is in evidence that the first tenant, who occupied one of the flats, did so in September, 1947, and a second tenant went into occupation in January, 1948. It is on. this evidence abundantly clear that 980 the premises or the flats now in dispute were in every sense newly constructed premises and the, Rent Controller was competent to fix the rent. " It is clear from the orders of the Rent Controller and of the District Judge in appeal that the question whether the second floor was newly constructed or not was really a question of fact, though undoubtedly a jurisdictional fact on which depended the power of the Rent Controller to take action under s.7A. If the Rent Controller had wrongly decided the fact and assumed jurisdiction where he had none, the matter would be open to reconsideration in revision. The High Court did not, however, go into the evidence, nor did it say that the finding was not justified by the evidence on record. The High Court referred merely to certain submissions made on behalf of the landlord and then expressed the opinion that what was done to the second floor was mere improvement and not a new construction. We think that the High Court was in error in interfering with the finding of fact by the Rent Controller and the District Judge, in support of which finding there was clear and abundant evidence which had been carefully considered and accepted by both the Rent Controller and the District Judge. In these two appeals we have come to the conclusion that the judgment of the High Court dated January 26, 1954, should be set aside and that of the District Judge restored. We may here note that so far as the standard rent fixed by the Rent Controller was concerned, the District Judge himself noted that the learned advocate for the landlord was not able to find any fault with the assessment made by the Rent Controller. Civil Appeal No. 171 of 1958. We now come to Civil Appeal No. 171. The facts of this appeal are somewhat different. We 981 have already stated that this appeal relates to two flats on the ground floor of plot No. 20, Block No. 13, Western Extension Area, Karolbagh. The tenant, who is the appellant before us, took the flats on a rent of Rs. 220 per month including tax on December 15,1950. On May 15, 1951 he made an application for fixation of standard rent under s.7A of the Control Act, 1947, on the ground that the rent charged was excessive and exorbitant. The application was contested by the landlord. On December 7, 1951, the Rent Controller fixed Rs. 150 per month as the standard rent inclusive of tax. The landlord filed an appeal to the District Judge Which was dismissed on May 12, 1953. The landlord then filed an application in revision to the High Court and the High Court accepted the application on May 10, 1954, and remanded the case for afresh trial. When the case came back to the Rent Controller, the landlord made an application to the Rent Controller to the effect that s.7A read with Schedule IV of the Control Act. ' 1947, was rendered unconstitutional and void on the coming into force 'of the Constitution of India. Apparently, this point was taken in view of the judgement of the Punjab High Court dated August 26, 1954, already discussed in the other appeals. On May 30, 1955, the Rent Controller held, on the basis of the aforesaid decision, that section 7A read with Schedule IV of the Control Act, 1947, was unconstitutional and therefore the application was not maintainable Accordingly, he dismissed the application. The matter was then taken to the District Judge in appeal. The learned District Judge who was bound by the decision of the Punjab High Court also held that s.7A of the Control Act, 1947, was unconstitutional and therefore the application was not maintainable. The tenant appellant then made an application under article 227 of the Constitution to the Punjab High Court. That application was summarily dismissed on March 7,.1956, 982 We have already dealt with the constitutional point as to whether s.7A read with Sch. IV of the Control Act, 1947 is, void after the coming into force of the Constitution of India by reason of a violation of the fundamental right guaranteed under article 14 of the Constitution and we have come to the Conclusion that s.7A and the relevant provisions of Sch. IV of the Control Act, 1947 are not unconstitutional. That being the position, the main ground on which the application of the appellant was dismissed disappears and the application must now be dealt with in accordance with law. Our attention has, however, been drawn to the Delhi and Ajmer Rent Control Act, 1952 (Act No., XXXVIII of 1952), which by s.46 repealed the Control Act, 1947. That section, however, contains a saving clause which is as follows : "46. Repeals and savings.(1) x x x (2)Notwithstanding such repeal, all suits and other proceedings pending at the commencement of this Act, whether before any court or the Rent Controller appointed under the Fourth Schedule to the said Act, shall be disposed of in accordance with the provisions of the said Act as if the said Act bad continued in force and this Act had not been passed : Provided that the procedure laid 'down in this Act shall, as far as may be, apply to suits and other proceedings pending before an Court. " We consider it unnecessary to determine the effect of the aforesaid saving clause in the present appeal. Neither the Rent Controller, nor the District Judge, nor the High Court considered the effect of the saving clause. The, application of the appellant was dismissed on the simple ground that s.7A read with Sch. TV of the Control Act, 1947 was unconstitutional. We consider that that ground is not 983 correct and the application of the tenant appellant for fixation of standard rent must now be deter . mined in accordance with law. It would be for the competent authorities to consider now the effect of s.46 of the Delhi and Ajmer Rent Control Act, 1952 or of any other law bearing on the question which may have come into existence since then. We, would, therefore, allow this appeal and set aside the orders of the Rent Controller, the District Judge and the High Court dismissing the application of the appellant. The application must now be dealt with in accordance with law by the authority competent to do so in the light of the observations made above. In the result the appeals in all three categories are allowed as indicated above. The appellants in all the appeals will be entitled to their costs, but there will be one set of hearing fee for each of the three categories of appeals. Appeals allowed.

The appellants applied to the Rent Controller for fixation of fair and standard rent of certain shops and other premises alleging that the rent charged by the landlords was exorbitant. The questions arising for determination were (1) whether the Delhi and Ajmer Marwara Rent Control Act, 1947 in so far as it provided for the fixation of standard rent in respect of premises the construction of which was completed after March 24, 1947 by the Rent Controller violated the fundamental right guaranteed under article 14 of the Constitution; and (2) whether the procedure to be followed by the Rent Controller 'violated the principles of natural justice. Held, that section 7A and the relevant provision , of Sch. IV of the Act laying down the procedure for fixing standard rent by the Rent Controller are not unconstitutional and do not violate article 14 of the Constitution. The classification between premises the construction of which was completed before March 24, 1947 when the Act came into force and those which were completed thereafter, is reasonable, and the criteria for the fixation of standard rent for both old and new buildings under the Act were not substantially different. The procedure laid down under those provisions does not violate the principles of natural justice. The power given to the Rent Controller is not arbitraly and he has to exercise it on a judicial consideration of all the circumstances of the case. 948 G.D. Soni vs section N. Bhalla, A.I.R. 1959 Punj. 381 approved. New Prakash Transport, Co. Ltd. vs New Suwarna Transport Co. Ltd., , Union of India vs T.R. Verma (1958) S.C.R. 499 followed. In the instant case ample opportunity was given to the landlord for producing all relevant evidence in the case which he did not avail himself of. It was not necessary under para 2, Sch. TV, to have two enquiries one for ascertaining whether there were good reasons for believing that the rent charged was exorbitant and another for fixing the standard rent. The proceedings before the Rent Controller were not vitiated merely because standard rent of certain vacant shops was also. , fixed in the process of fixing the standard rent for the entire building in which those shops were situated; that would not affect the legality of the fixation of the rent for the shops which had been let out to tenants.

minal Appeal No. 146 of 1958. Appeal by special leave from the judgment and order dated April 14, 1957, of the Bombay High Court at Rajkot in Criminal (jail) Appeal No. 73 of 1956. AND Criminal Appeal No. 174 of 1959. Appeal by special leave from the judgment and order dated June 4, 1956, of the Calcutta High Court in Criminal Revision No. 623 of 1958. 13 H. R. Khanna and T. M. Sen, for the appellant in Cr. A. No. 146 of 1958. Specimen handwritings of the accused had been taken during investigation while the accused was in police custody. These have been excluded from consideration by the Courts below on the ground that obtaining of such signatures offended article 20 (3)11 the courts holding that an element of compulsion was implicit in the accused being in police custody at the time the handwritings were taken. The mere fact that the accused was in police custody does not by itself imply that compulsion was used for obtaining the specimen handwritings. Even if there is compulsion, it does not amount to testimonial compulsion. Action taken under sections 94 and 96 Criminal Procedure Code to secure production of documents though search warrants, does not amount to compulsion within the meaning of article 20 (3). Section 73, Evidence Act also contemplates the obtaining of specimen handwriting. If a person gives the specimen handwriting voluntarily ,it cannot be said that he was compelled to give it. If the police merely requests the accused, then it does not amount to compulsion, but if it directs the accused to write and if physical force is used or if there is any show of force or threat, then alone would it be compulsion. Inducement is not compulsion. I.L.R. ; 1957 Mad. 66, , , A.I.R. 1959 Bom. 865, I.L.R. , A.I.R. 1955 Cal. 247, I.L.R. 1952 Tr. Co. 447, A.I.R. 1958 All. 119. Refers to Willis on Constitutional Law dealing with self incrimination. In A. 1. R. section 27 of the Evidence Act has been held to be constitutional. M.C. Setalvad, Attorney General of India, B. Sen and T. M. Sen, for Intervener No. 1. There are four elements in article 20(3) which must be satisfied before a person can claim the protection of article 20(3), namely (i) he must be accused, (ii) he must have been compelled, (iii) he Must have 14 been compelled to be a witness and (iv) his witnessing must be against himself. There must be an element of compulsion, a voluntary act is not compulsion. Coercion is an element of compulsion. In inducement or moral compulsion, the mind is not free. There was nothing in England which prevented a voluntary statement. ; and (1960) 3 S.C.R. 116, 125. The fact whether a person has been compelled does not rest solely on the effect which the presence of a police officer might have on the mind of the person. I.L.R. , Willis p. 524, A.I.R. 1955 Cal. 247. Even a direction under section 73, Evidence Act would not amount to compulsion. A.I.R. 1958 All. 119, Merely because a person who makes a statement is in police custody it cannot be inferred that compulsion has been used. Willis p. 521. Observations in Sharma 's case with regard to the words "to be a witness" are excessive. It would be useful to see what is the American fifth amendment. To be a witness means that a person either says something or writes something which he knows. He must depose or write as to something of which he has knowledge. In giving a thumb impression or specimen writing a person does not say or write anything against himself. section M. Sikri Advocate General, Punjab, N. section Bindra and D. Gupta, for respondent in Cr. Nos. 110 and 111 of 58. Section 5 of the , permits the obtaining of finger prints of an accused person by order of a Magistrate. This is not hit by article 20 (3). Article 20 (3) does not apply to the stage of investigation. It only prohibits the compulsory examination or famishing of incriminatory statements or communication by the accused. It does not include the compulsory production of documents. Even if article 20 (3) prohibits the compulsory production of documents, it does not prohibit the compulsory 15 examination of the body of the accused or any part of it. In order to test whether there has been compulsion or not it is the nature of the action of the authority or court that determines the question and not the state of mind of the accused. The privilege granted to an accused person under Art, 20 (3) is by its nature capable of waiver and if there is no protest, it is deemed to have been waived. The Article deals with the stage of conviction. Wigmore vol. 8, p.276, 304, 317 and 319. ; ,109; , and 1030. The word " 'witnesses" should be given its natural interpretation. The original rule in England was that you will not be put in court and compelled to give evidence against yourself and referred only to testimony given in court. Article 20 (3) gives the same guarantee. Wigmore vol. 8, p. 623, Phipson on Evidence, 9th Edition, p.214. It protects extraction of incriminatory statements or communi cations, but not the exhibition of body or any part of it for examination. Merely handing over of a document is not covered by the guarantee as it does not amount to communication. ; There is no compulsion if the witness or accused does not object. ; , 76 L.Ed.211; , , Wigmore vol. 8, p. 399. section M. Bose Advorate General for the State of West Bengal, B. Sen, and P. K. Bose, for appellant in Cr. 174 of 1959. The question concerned in Cr. A. No. 174 of 1959 is whether the obtaining of specimen handwriting under s.73 of the Evidence Act amounts to testimonial compulsion. Decision, , which hold that it is so are : A. 1. R. 1957 M. P.73, A. I. R. 1959 M. P. 411; A. I. R. 1960 Ker.392; A. I. R. Willoughby vol. 2, para 720, 29 L.Ed. Testimonial compulsion means that you cannot make a witness say what he does not want to say in court. Section 118, Evidence Act indicates that "testify" means to make statements in Court and not statements outside court. Article 20(3) applies only to oral statements made before the court. section P. Verma, for respondent in Cr. A. No. 146/1958. Sharma 's case puts the right construction on article 20(3). The question of inconvenience should not be taken into consideration. ; Article 20(3) could be split up into 6 components, i. e. (i) No person, (ii) accused of an offence, (iii) shall be compelled, (iv) to be, (v) to be a witness, and (vi) to be a witness against himself. In the present case it is not necessary to discuss (i). (ii) indicates a time whenever incrimination is eminent and the guarantee comes into play. " 'Accused of an offence" is merely descriptive of the person. Whenever a person is accused, nothing obtained from him by compulsion can be used against him. ; ; ; ; "Accused of an offence" does not mean accused at the time when a person is compelled to provide evidence. A. I. R. (iii) In case of police custody there is irrefutable presumption of compulsion. A. I. R. In other cases it may be a question of fact whether there was compulsion or not. Compulsion means an act which is involuntary, under threat, coercion or inducement. It has to be seen what has motivated the act. Compulsion means any non voluntary positive act not of free volition. (iv) The words used are ",to be" and not ,to appear". This brings in the idea of all kinds of testimony (evidence) and removes all restrictions as to time and place. (v) To be a witness, means to furnish evidence. Wigmore 8th vol. p.362. Best on Evidence p. 11 2. Phipson, p. 2. ; A.I.R. 1960 Ker. 392; American Jurisprudence, vol. 58, p. 57. To be a witness against himself means to do a positive act which would incriminate him. A.I.R. 1956 Mad. 165. Compelling the production of any sort of evidentiary document which is likeiy to help the prosecution 17 is hit by the guarantee. The object of the guarantee is not to let a person degrade 'himself ; I.L.R. 1957 Cutt, 200. R. C. Datta, for Intervener No. 3. P. section Safeer and R. section Gheba, for appellant in Cr. Nos. 110 and 111 of 1958. The words used in article 20(3) are not "appear as a witness against himself. " It covers the stage of investigation also and protects all action of an accused person that may be used against him at the trial. Section 6 of the Prisoners Identification Act makes a person who refused to give his photograph or measurement, guilty of an offence. No person can waive the fundamental right guaranteed under article 20(3). ; Any part of the evidence contributed to by the accused under compulsion is hit by the guarantee. H. R. Khanna in reply. Sections 1, 118,132 and 139 of the Evidence Act show that the words "to be a witness" means giving evidence in court and must he restricted to judicial proceedings. The mere fact that an accused person 'is in police custody does not raise any presumption. that compulsion has been used. August 4. The Judgment of Sinha C. J., Imam, Gajendragadkar, Subba Rao, Wanchoo, Raghubar Dayal, Rajagopala Ayyangar and Mudholkar JJ., was delivered by SINHA C. J. These appeals have been beard together only insofar as they involve substantial questions of law as to the interpretation of the Constitution, with particular reference to, cl.(3) of article 20. This larger Bench was constituted in order to reexamine some of the propositions of law laid down by this Court in the case of M.P. Sharma vs Sathish Chandra(1),because when one of the cases was heard by five of us, we felt that (1) ; 18 some of the propositions therein laid down may have been too widely stated, and, therefore, required to be restated with more particularity. We have not heard counsel for the parties ion the merits of the orders passed by the Courts below, but have confined the discussions at the Bar, insofar as they had any bearing on the questions of law relating to the interpretation of el. (3) of article 20 of the Constitution. It is not necessary to state in any detail the facts of each of the cases now before us. We shall, therefore, state only so much of the facts as have 'Occasioned calling in aid of the provisions of el. (3) of article 20 of the Constitution. In the first case, namely, Criminal Appeal 146 of 1958, the. State of Bombay is the appellant,. The ,respondent was charged, alongwith another person, under section 302, read with section 34 of the 1. P. C., as also under section 19(e) of the Indian Arms Act (XI of 1878). The Trial Court found him guilty of those charges and sentenced him to imprisonment for life under section 302, read with section 34 of the I.P.C. and to. a term of two years rigorous imprisonment for the. offence under the Arms Act. At the trial the identification of the respondent, as one of the two alleged culprits, was the most important question to be decided by the Court. Besides other evidence, the prosecution adduced in evidence a chit exhibit 5 alleged to be in his handwriting and said to have been given by him. In order to prove that exhibit 5 was in the handwriting of the respondent, the police had obtained from him, during the investigation, three specimen handwritings of his on three separate, sheets of paper which were marked as Exs. 27, 28 and 29. The disputed document, namely, Ex.5 was compared with the admitted handwritings on Exs. 27, 28 and 29 by the Handwriting Expert whose evidence was to the effect that they are all writings by the same person. At the trial and in the High Court, 19 the question was raised as to the admissibility of the specimen writings contained in Exs. 27, 28 and 29, in view of the provisions of article 20(3) of the Constitution. It is an admitted fact that those specimen writings of the accused had been taken by the police while he was in police custody, but it was disputed whether the accused had been compelled to give those writings within. the meaning of cl. (3) of article 20. The plea of the accused that he was forced by the Deputy Superintendent of Police to give those writings has not been accepted by the learned Trial Judge. But those documents have been excluded from consideration, as inadmissible evidence, on the ground 'that though there was no threat or force used by the police in obtaining those writings farm the accused person, yet in the view of the Court ""the element of compulsion was implicit in his being at that time in police custody. " In this conclusion both the Trial Judge and the High Court have agreed. The identification of the accused person was also sought to be proved by the evidence of witnesses, who identified him at an identification parade. But the holding of the identification parade has not been sought to be brought within the prohibition of cl. (3) of article 20. After eliminating the Exs. 27, 28 and 29 from their consideration the High Court, on a consideration of the other evidence in the case, came to the conclusion that the identity of the respondent had not been established beyond a reasonable doubt. Hence, giving him the benefit of doubt, they acquitted him. The State of Bombay moved this Court and obtained special leave to appeal from the Judgment and Order of acquittal, passed by the High Court. On these facts, the only questions of constitutional importance that this Bench has to determine are; (1) whether by the production of the specimen handwritings Exs. 27, 28, and 29 the accused could be said to have been "a witness against himself ' within the meaning of article 20(3) of the 20 Constitution; and (2) whether the were fact that when those specimen handwritings had been given, the accused person was in police custody could, by itself, amount to compulsion, apart from any other circumstances which could be urged as vitiating the consent of the accused in giving those specimen handwritings. This Bench is not concerned with the further ques tion whether in all the circumstances "closed by the evidence in this case, the accused could be said to have been compelled, as a matter of fact, to give. those specimens. In Criminal Appeals 110 and 111 of 1958, which arose out of the same set of facts, the accused person has been convicted by the Courts below under sections 380 and 457 of the I.P.C., as also under. s.19(f) of the Indian Arms Act. The facts of the case necessary for bringing out the points in controversy are that a shop in Hissar in Punjab was burgled. In the course of the burglary four double barrelled guns, one single barrelled gun and a rifle were stolen. During his interrogation by the police at the investigation stage, the appellant is alleged to have given the information that out of the arms stolen from the shop at Hissar he had buried one 22 bore rifle, two 12 bore doublebarrelled gunk; and one 18 single barrelled gun at a certain place. It is alleged that as a consequence of the information thus given by the accused and on his pointing out the exact location where these buried articles could be found, the rifles and guns were actually recovered. During the investigation the police had taken possession of certain glass panes and phials from the burgled shop which bore some palm and finger impressions (Exs. P10 to P12) In order to compare the impressions on those glass panes and phials with those of the accused the investigation police officer got the impressions of the palms and fingers of the accused taken in the presence of a Magistrate. On the evidence adduced by the prosecution,including the 21 fact of the recovery of the firearms and the evidence of the identity of the impressions of the accused taken as aforesaid, he was convicted and sentenced by the Courts below to certain terms of imprisonment and was also ordered to pay a fine of one thousand rupees. On appeal, the sentence of fine and imprisonment was modified by the Court of Appeal. In revision in the High Court, both the revisional applications were dismissed. The convicted person prayed for and obtained the necessary certificate of fitness under article 134(1) (e) of the Constitution from the High Court of Punjab. The points raised in this Court were; (1) that section 27 of the Indian Evidence Act is violative of article 14 of the Constitution; and (2) the impressions of the appellant 's palms and fingers taken from him after his arrest, which were compared with the impressions on the glass panes and phials, were not admissible evidence in view of the provisions of article 20(3) of the Constitution. Though the provisions of sections 5 and 6 of the , (XXXIII of 1920) have not in terms been attacked as ultra vires article 20(3) of the Constitution, the effect of the argument based on that article is to bring into controversy the constitutionality of sections 5 and 6 of the Act. As a matter of fact, one of the propositions of law to be urged in support of the appeals is stated in these terms; "that sections 5 and 6 of the , read with article 20(3) of the Constitution render the evidence of measurements to be inadmissible". In the last case, Criminal Appeal 174 of 1959, the State of West Bengal has preferred this appeal by special leave granted by this Court under article 136(1) of the Constitution against the judgment and order of the High Court at Calcutta, dated June 4, 1959, passed in its revisional jurisdiction, against an order of the Magistrate, First Class, Howrah; directing, the respondent to give his 22 specimen writing and signature, under section 73 of the Indian Evidence Act. It is only necessary to state the following facts in order to bring out the questions of law bearing on the interpretation of the Constitution. During the investigation of a criminal case relating to trafficking in ,contraband opium, the respondent 's residence was searched and certain quantity of contraband opium was alleged to have been found in his possession. The respondent, along with another person, was produced before a Magistrate of the first Class at Howrah and was later released on bail. from the materials and statements obtained during the investigation of the case by the police, it was considered that there were reasonable grounds to believe that the endorsement on the , back of certain railway receipts for consignment of goods seized at Howrah Railway Station was in the handwriting of the respondent, and it was, therefore, necessary to take his specimen writing and signature for the purpose of comparison and verification. When the accused were produced before the Magistrate, the Investigating Officer made a prayer to the Magistrate for taking specimen writing and signature of the respondent. On an adjourned date when the accused persons, including the respondent, were present in the Court of the Magistrate, the respondent declined to give his specimen writing and signature, contending that article 20 (3) of the Constitution prohibited any such specimens being taken against the will of the accused. After bearing the parties, the learned Magistrate overruled the objection on behalf of the accused and allowed the prayer by the prosecution for taking the specimen writing and signature of the respondent. The respondent moved the High Court at Calcutta under section 439 of the Cr. P.C. and article 227 of the Constitution. The case was heard by a Division Bench consisting of J.P. Mitter and Bhattacharyya, JJ, on July 2 and 3, 1958, but the judgment was not delivered until the 23 4th of June, 1959. The Court held that the prohibition contained in article 20 (3 of the Constitution applied: to the case of writing and signature to be taken, as directed by the learned Magistrate. The Court. relied upon the decision of this Court in: M.P. Sharma 's case.(1) In coming to this conclusion, the Division Bench disagreed with the previous decision of another Division Bench of that, Court in the case of Sailendra Nath Sinha vs The State (2), which had laid down that a mere direction under s.73 of the Evidence Act to a person accused of an offence to give his specimen writing did not come within the prohibition of article 20 (3) of the Constitution. The earlier Bench further held that the decision of this Court in Sharma 's case(2), referred to above, did not govern the case of direction given by the Court under s.73 of the Evidence Act for giving specimen writing. Instead of referring the question to a larger Bench, the later Division Bench took upon itself to pronounce against the considered view of that Court in the earlier decision. The State of West Bengal naturally had to come up to this Court to get the constitutional issues determined because the issues raised were of far reaching importance in the investigation and trial of criminal cases. The main question which arises for determination in this appeal is whether a direction given by a Court to an accused person present in Court to give his specimen writing and signature for the purpose of comparison under the provisions of s.73 of the Indian Evidence Act infringes the fundamental right enshrined in article 20 (3) of the Constitution. The arguments at the Bar may be classified as taking three distinct lines. The first line, on the one extreme, may be said to have been taken by Mr. Sikri, the Advocate General of Punjab, and which may be characterised as a narrow view, (1) ; (2) [1955] A. 1. R. Cal. 24 runs as follows: Cl. (3) aforesaid, in view of its setting, its history and the policy underlying, the privilege accorded by the Constitution to an accused person, should not be applied at ,he stage of investigation of an offence. It should be confined to cases of compulsory extraction of incriminating statements or communications by an accused person in Court, the expression compelled to be a witness ' being understood as meaning being compelled to give oral testimony '. It does not include the compulsory production of documents. Similarly, it does not prohibit the compulsory. exhibition or examination of the body of the accused, or any part of it, or the taking of specimen writ ing, thumb impression of the palm or the feet or the fingers of an caused. Whether or not there has been compulsion should be judged by the nature of the action taxi by the authority, or the Court that determines the controversy, and not the state of mind of the accused. On the other extreme is the argument by Mr. S.P. Varma, for the accused in the first case, who contended that the clause aforesaid of the Constitution gives complete protection of the widest amplitude to an accused person, irrespective of the time and place and of the nature of the evidence, whether it is oral or documentary or material. The extreme form, which his argument took can best be stated in his own words as follows : ""Anything caused, by any kind of threat or inducement, to be said or done, by a person, accused or likely to be accused of any. offence, by non voluntary positive act or speech, of that person which furthers he cause of any prosecution against him or which results or is likely to result in the incrimination of hat person qua any offence, is violative of the, fundamental right guaranteed under el. of article 20 of the Constitution of India According to his argument, if an accused person makes any statement or any discovery, there 25 is not only a rebuttable presumption that he had been compelled to do so, but that it should be taken as a conclusive proof of that inferential fact. Any kind of inducement, according to him, is also included in the expression 'compulsion ' by the police or elsewhere. The test, according to him, is not the volition of the accused but the incriminatory nature of the statement or communi cation. Hence, any statement made to a police officer, while in police custody, brings the same within the prohibitory ambit of the clause of the Constitution. On the face of them, the propositions propounded by Mr. Varma are much too broadly and widely stated to be accepted. The third view, which may be characterised as an intermediate view, was advocated by the learned Attorney General, appearing for the Union. According to him, a person seeking protection under the clause must satisfy %II the four constituent elements contained in cl. (3) of article 20, namely, (1) he must be an accused person; (2) be must have been compelled; (3) the compulsion must be to be a witness; and (4) against himself. Compulsion, according to him, means coercion or constraint and does not include mere asking by the police to do a certain thing or the direction by a court to give a thumb impression or specimen writing. In other words, compulsion has to be equated to what has been sometimes characterised as " 'third degree" methods to extort confessional statements. "To be a witness" is an expression which must be understood in consonance with the existing law of evidence and criminal, procedure, e.g. ss, 27 and 73 of the Evidence Act and sections 94 and 96 of the Code of Criminal Procedure. Though, according to English Law, the expression is confined to oral testimony, he was prepare to go to the length of conceding that any statement, whether oral or in writing by an accused person, transmitting his knowledge disclosing relevant 26 facts of which he was aware, would amount to bring a witness ' against himself. But mere production of some material evidence, by itself, could not come within the ambit of the expression to be a witness ', The several questions for decision arising out of this batch of cases have to be answered with reference to the provisions of cl. (3) of article 20 of the Constitution which is in these terms : "No person accused of any offence shall be compelled to be a witness against himself" These provisions came up for consideration by the Full Court in the case of M. P. Sharma V. Satish Chandra. (1) Though the question directly arising for decision in that case was whether a search and seizure of documents under the provisions of sections 94 and 96 of the Code of Criminal Procedure came within the ambit of the prohibition of cl. (3) of article 20 of the Constitution, this Court covered a much wider field, Besides laying down that the search and seizure complained of in that case were not within the prohibition, this Court examined the origin and scope of the doctrine of protection against self incrimination with reference to English Law and the Constitution of the United States of America, with particular reference to the Fourth and 'Fifth Amendments. On an examination of the case law in England and America and the standard text books on Evidence, like Phipson and Wigmore, and other authorities, this Court observed as follows : "Broadly stated the guarantee in Art.20(3) is against "testimonial compulsion". It is suggested that this is confined to the oral evidence of a person standing his trial for an offence when called to the witness stand, We can see no reason to confine the content of the constitutional guarantee to this barely literal import. So to limit it would (1) ; 27 be to rob the guarantee of its substantial purpose and to miss the substance for the sound as stated in certain American decisions. The phrase used in article 20(3) is "to be a witness". A person can, "be a witness" not merely by giving oral evidence but also by producing documents or making intelligible gestures as in the case of a dumb witness (see section 119 of the Evidence Act) or the like. "To be a witness" is nothing more than "to furnish evidence", and such evidence can be furnished through lips or by production of a thing or of a document or in other modes. So far as production of documents is concerned, no doubt, section 139 of the Evidence Act says that a person producing a document on summons is not, a, witness, But that section is meant to regulate the right of cross examination. It is not a guide to the connotation of the word "witness", which must be ' understood in its natural sense, i.e., as referring to a person who furnishes evidence. Indeed, every positive volitional act which furnishes evidence is testimony, and testi monial compulsion connotes coercion which procures the positive volitional evidentiary acts of the person, as opposed to the negative attitude of silence or submission on his part. Nor is there any reason to think that the ' protection in respect of the evidence so: procured is confined to what transpires at the trial in the court room. The phrase used in article 20(3) is "to be a witness" and not to " 'appear as a witness" : It follows that the protection afforded to an accused in so far as it is related to the phrase "to be a witness" is not merely in respect of testimonial com pulsion in the court room but may well extend to compelled testimony previously obtained from him. It is available therefore ', to a person against whom a formal accusation 28 relating to the commission of an, offence has been levelled which in the normal course may result in prosecution. Whether :it is avail able to other persons in other situations does not call for decision in this case." This Court did not accept the contention at the guarantee against testimonial compulsion to be confined to oral testimony at the witness stand when standing trial for an of Fence. The guarantee was, thus,held to include not only oral testimony given in court or out of court, but also to statements in writing which incriminated the maker when figuring as an accused person. After having heard elaborate arguments for and against the views thus expressed by this Court after full deliberation, we do not find any good reasons for departing from those views. But the Court went on to observe that " 'to be a witness" means "to furnish evidence" and includes not only oral testimony or statements in writing of the accused but also production of a thing or of evidence by other modes. It may be that this Court did not intend to lay down certainly it was not under discussion of the Court as a point directly arising for decision that calling upon a person accused of an offence to give his thumb impression, his impression of palm or fingers or of sample handwriting or signature comes within the ambit of ",to be a witness" which has been equated to "to furnish evidence". Whether or not this Court intended to lay down the rule of law in those wide terms has been the subject matter of decisions, in the different High Courts in this country. Those decisions are, by no means, uniform ; and conflicting views have been expressed even in the same High Court on different occasions. It will serve no useful purpose to examine those decisions in detail. It is enough to point out that the most recent decision, to which our attention was called, is of a Full Bench of the Kerala High Court in the case of State of Kerala 29 vs K.K. Sankaran Nair(1). In that case, Ansari C. J., who delivered the opinion of the Court, has made reference to and examined in detail the pronouncements of the different High Courts. Ultimately he came to the conclusion that the decision of this Court in Sharma 's Case (2) also covered the case of a specimen handwriting given by an accused person, under compulsion. "To be a witness" may be equivalent to "furnishing evidence" in the sense of making oral or written statements, but not in the larger sense of the expression so as to include giving of thumb impression or impression of palm or foot or fingers or specimen writing or exposing a part of the body by an accused person for purpose of identification. "Furnishing evidence" in the latter sense could not have been within the contemplation of the Constitution makers for the simple reason that though they may have intended to protect an accused person from the hazards of self incrimination, in the light of the English Law on the subject they could not have intended to put obstacles in the way of efficient and effective investigation into crime and of bringing criminals to justice. The taking of impressions or parts of the body of an accused person very often becomes necessary to help the investigation of a crime. It is as much necessary to protect an accused person against being compelled to incriminate himself, as to arm the agents of law and the law courts with legitimate powers to bring offenders to justice. Further more it must be assumed that the Constitution makers were aware of the existing law, for example, s.73 of the Evidence Act or sections 5 and 6 of the Identification of prisoners Act (XXXIII of 1920).Section 5 authorises a Magistrate to direct any person to allow his measurements or photographs to be (1)A.I.R.1960 Kerala 392 (2)[1954] S.C.R.1077. 30 taken, if he is satisfied that it is expedient for the purposes of any investigation or proceeding under the Code of Criminal Procedure to do so Measurements ' include finger impressions and foot print impressions. If any such person who is directed by a Magistrate, under section 5 of the Act, to allow his measurements or photographs to be taken resists or refuses to allow the taking of the measurements or photographs, it has been declared lawful by section 6 to use all necessary means to secure the taking of the required measurements or photographs. Similarly, s.73 of the Evidence Act authorises the Court to permit the taking of finger impression or a specimen handwriting or signature of a person present in Court, if necessary for the purpose of comparison. The matter maybe looked at from another point of view. The giving of finger impression or of specimen signature or of handwriting, strictly speaking, is not ",to be a witness". "To be a witness" means imparting knowledge in respect of relevant fact, by means of oral statements or statements in writing, by a person who has personal knowledge of the facts to be communicated to a court or to a person holding an enquiry or investigation. A person is said to be a witness, to a certain state of facts which has to be determined by a court or authority authorised to come to a decision, by testifying to what he has seen, or something he has heard which is capable of being beard and is not hit by the rule excluding hearsay or giving his opinion, as an expert, in respect of matters in controversy. Evidence has been classified by text writers into three categories, namely, (1) oral testimony; (2) evidence furnished by documents; and (3) material evidence. We have already indicated that we are in agreement with the Full Court decision in Sharma 's case (1) that the prohibition in cl.(3) of Art.20 covers not only oral testimony given by a person accused of an offence but also (1) ; 31 his written statements which may have a bearing on the controversy with reference to the charge against him. The accused may have documentary evidence in his possession which may throw some light on the controversy. If it is a document, which is not his statement conveying his personal knowledge relating to the charge against him, he may be called upon by the ' Court to produce that document in accordance. with the provisions of s.139 of the Evidence Act, which, in terms, provides that a person may be summoned to produce a document in his possession Cur power and that he does not become a witness by the mere fact that he has produced it; and therefore, lie cannot be cross examined. Of course, he can be cross examined if he is called as a witness who has made statements conveying his personal knowledge by reference to the contents of the document or if he his given his statements in Court otherwise than by reference to the contents of the documents. In our opinion, therefore, the observations of this Court in Sharma 's case(,) that s.139 of the Evidence Act has no bearing on the connotation of the word 'witness ' is not entirely well founded in law. It is well established that cl.(3) of Art.20 is directed against self incrimination by an accused person. Self incrimination must mean conveying information based upon the personal knowledge of the person giving the information and cannot include merely the mechanical process of producing documents in court which may throw a light on any of the points in controversy, but which do not contain any statement of the accused based on his personal knowledge. For example, the accused person may be in possession of a document which is in his writing or which contains his signature or his thumb impression. The production of such a document, with a view to comparison of the writing or the signature or the impression, is not the statement of (1) ; 32 an accused person, which can be said to be of the nature of a personal testimony. When an accused person is called upon by the Court or any other authority holding an investigation to give his finger impression or signature or a specimen of his handwriting, he is not giving any testimony of the nature of a 'personal testimony '. The giving of a "personal testimony ' must depend upon his volition. He can make any kind of statement or may refuse to make any statement. But his finger impressions or his handwriting, in spite of efforts at concealing the true nature of it by dissimulation cannot, change their intrinsic character. Thus, the giving of finger impressions or of specimen writing or of signatures by an accused person, though it may amount to furnishing evidence in the larger sense, is not included within the expression to be a witness '. In order that a testimony by an accused person may be said to have been self incriminatory, the compulsion of which comes within the prohibition, of the constitutional provision, it must be of such a ' character,that byitselfit should have the tendency of incriminating the accused, if riot also of actually doing so. In other words,it should be a statement which makes the case against the accused person atleast probable, considered by itself. A specimen handwriting or signature or finger impressions by themselves are no testimony at all being wholly innocuous because they are unchangeable except in rare cases where the ridges of the fingers or the style of writing have been tampered with. They are only materials for comparison in order to lend assurance to the Court that its inference based on other pieces of evidence is reliable. They are neither oral nor documentary evidence but belong to the third category of material evidence which is outside the limit of 'testimony '. Similarly,during the investigation of a crime 33 by the police, if an accused person were to point out the place where the corpus delicti was lying concealed and in pursuance of such an information being given by an accused person, discovery is made within the meaning of section 47 of the Evidence Act, such information and the discovery made as a result of the information may be proved in evidence even though it may tend to incriminate the person giving the information, while in police custody. Unless it is held that the provisions of section 27 of the Evidence Act, in so far as they make it admissible evidence which has the tendency to incriminate the giver of the information, are unconstitutional as coming within the prohibition of el. (3) of article 20, such information would amount to furnishing evidence. This Court in Sharma 's case (1) was not concerned with pronouncing upon the constitutionality of the provisions of section 27 of the Evidence Act. It could not, therefore, be said to have laid it down that such evidence could not be adduced by the prosecution at the trial of the giver of the information for an alleged crime. The question whether section 27 of the Evidence Act was unconstitutional because it offended article 14 of the Constitution was considered by this court in the, case of State of U. P. vs Deomen Upadhyaya(2). It was held by this Court that section 27 of the Evidence Act did not offend article 14 of the Constitution and was, therefore, intra vires. But the question whether it was unconstitutional because it contravened the provisions of el. (3) of article 20 was not considered in that case. That question may, therefore be treated as an open one. The question has been raised in one of the cases before us and has, therefore, to be decided. The information given by an accused person to,, a police. officer leading to the discovery of a fact which may or may not prove incriminatory has been made admissible in evidence by that Section. If it is not incriminatory of the person giving the (1) ; (2) [1961] 1 S.C.R.14. 34 information, the question does not arise. It can arise only when it is of an incriminatory character so far as the giver of the information is concerned. If the self incriminatory information has been given by an accused person without any threat, that will be admissible in evidence and that will not be hit by the provisions of el. (3) of article 20 of the Constitution for the reason that there has been no compulsion. It must, therefore, be held that the provisions of section 27 of the Evidence Act are not within the prohibition aforesaid, unless compulsion has been used in obtaining the information. In this connection the question was raised before us that in order to bring the case within the prohibition of cl. (3) of article 20, it is not necessary that the statement should have been made by the accused person at a time when he fulfilled that character ; it is enough that he should have been an accused person at the time when the statement was sought to be proved in Court, even though he may not have been an accused person at the time he had made that statement. The correctness of the decision of the Constitution Bench of this Court in the case of Mohamed Dastagir vs The State of Madras (1) was questioned because it was said that it ran counter to the observations of the Full Court in Sharma 's Case. (2) In the Full Court decision of this Court this question did not directly arise ; nor was it decided. On the other hand, this Court, in Sharma 's case(2), held that the protection under article 20 (3) of the Constitution is available to a person against whom a formal accusation had been levelled, inasmuch as a First Information Report had been lodged against him. Sharma 's case (2), therefore, 'did not decide anything to the contrary of what this Court said in Mohamed Dastagir vs The State of Madras(,). (1) ; (2) ; 35 The latter decision in our opinion lays down the law correctly. In order to bring the evidence within the inhibitions of cl. (3) of article 20 it must be shown not only that the person making the statement was an accused at the time, he made it and that it had a material bearing on the criminality of the maker of the statement, but also that be was compelled to make that statement. "Compulsion ' in the context, must mean what in law is called 'duress '. In the Dictionary of English Law by Earl Jowitt, 'duress ' is explained as follows. : " Duress is where a man is compelled to do an act by injury, beating or unlawful imprisonment (sometimes called duress in strict sense) or by the threat of being killed, suffering some grievous bodily harm, or being unlawfully imprisoned (sometimes called menace, or duress per minas). Duress also includes threatening, beating or imprisonment of the wife, parent or child of a person. " The compulsion in this sense is a physical objective 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. Hence, the mere asking by a police officer investigating a crime against a certain individual to do a certain thing is not compulsion within the meaning of article 20 (3). Hence, the mere fact that the accused person, when he made the statement in question was in police custody would not, by itself, be the foundation for an inference of law that the accused was compelled to make the statement. Of course, it is open to an accused person to show that while he was in police custody at the relevant time, he was subjected to treatment which, in the circumstances of the case, 36 would lend itself to the inference that corapulsion was, in fact, exercised. In other words, it will be a question of fact in each case to ' determined by the Court on weighing the facts and circumstances disclosed in the evidence before it '. In view of these considerations, we have come to the following conclusions : (1) An accused person cannot be said to have been compelled to be a witness against himself simply because he made a statement while in police custody, without anything more. ' In other words, the mere fact of being in police custody at the time when the statement in question was 'made would not., by itself, as a proposition of law, lend itself to the inference that the accused was compelled to make the statement, though that fact, in conjunction with other circumstances disclosed in evidence in a particular case, would be a relevant consideration in an enquiry whether or not the accused person had been compelled to make the impugned statement. (2) The mere questioning of an accused person by a police officer, resulting in a voluntary statement, which may ultimately turn out to be incriminatory, is not compulsion '. (3) To be a witness ' is not equivalent to garnishing evidence ' in its widest significance ; that is to say, as including not merely making of oral or written statements but also production of documents or giving materials which may be relevant at a trial to determine the guilt or innocence of the accused. (4) Giving thumb impressions or impressions of foot or palm or fingers or specimen writings or showing parts of the body by way of identification were not included in the expression to be a witness 37 (5) 'To be a witness ' means imparting knowledge in respect of relevant facts by an oral statement or a statement in writing, made or given in Court or otherwise. (6) 'To be a witness ' in its ordinary grammatical sense means giving oral testimony in Court. Case law has gone beyond this strict literal interpretation of the expression which may now bear a wider meaning, namely, bearing testimony in Court or out of Court by a person accused of an offence, orally or in writing. (7) To bring the statement in question within the prohibition of article 20(3), the person accused must have stood in the character of an accused person At the time he made the statement. It is not enough that he should become an accused, any time after the statement has been made. The appeals will now be listed for hearing on merits in accordance with the above principles. The Judgment of section K. Das, Sarkar and Das Gupta, JJ.was delivered by DAS GUPTA, J. Is a person compelled "to be a witness" against himself within the meaning of Art.20(3) of the Constitution when he is compelled to give his specimen handwriting or signature, or impressions of his fingers, palm or foot to the investing officer? Is he compelled "to be a witness" against himself within the meaning of the same constitutional provisions when he is compelled to give his specimen handwriting and signature for the purpose of comparison under the provisions of section 73 of the Indian Evidence Act? These Are the main questions canvassed before us and they have both been answered in the negative in the judgment just pronounced by my Lord the Chief Justice. We agree with these answers; but as we have reached the same conclusion, by a 38 somewhat different approach, and for different reasons, these have to be briefly indicated. The question as regards the meaning to be attached to the words "to be a witness" as used in Art.20(3) of the Constitution ' came up for consideration in M.P. Sharma 's Case (1). It was heard by all the eight Judges who constituted the Court at the time, and they came to a unanimous decision. The Court in that case had to decide whether search and seizure of documents under ss.94 and 96 of the Code of Criminal Procedure is a compelled production of the same so as to infringe the provisions of Art.20(3) of the Constitution. After pointing out that the guarantee in Art.20(3) was against, "testimonial compulsion", Jagannadhadas J. speaking for the Court said "The phrase used in Art.20(3) is "to be a witness". A person can "be a witness" not merely by giving oral evidence but also by producing documents or making intelligible gestures as in the case of a dumb witness (see section 119 of the Evidence Act) or the like. "To be a witness" is nothing more than " 'to furnish evidence" and such evidence can be furnished through the lips or by production of a thing or of a document or in other modes. " He next observed that s.139 of the Evidence Act which says that a person producing a document on summons is not a witness, is really meant to regulate the right of cross examination and cannot be "la guide to the connotation of the word "witness in Art.20(3), which must be understood in its natural sense, i.e., as. referring to a person who furnishes evidence", and then proceeded : "Indeed, every positive volitional act which furnishes evidence is testimony (1) ; 39 and testimonial compulsion connotes coercion which procures the positive volitional evidentiary acts of the person, as opposed to the negative attitude of silence or submission on his part". It was further stated that there was no reason to think that the protection in respect of the evidence so procured was confined to what transpired at the trial in the court room. If the learned Judges had hoped that by their exhaustive judgment they would end all disputes about the limits of the protection granted by article 20 (3), these hopes were soon, shattered. Questions were before long raised before the different High Courts, as to whether on the interpretation of the words "to be a witnes" given by this Court in Sharma 's Case, compelling an accused person to give his finger prints or impressions of palm or foot or a specimen handwriting in the course of investigation, amounted to an infringement of article 20(3). The conclusions reached by the different High Courts, and in one case at least, by two Benches of the same High Court were different. That is why it has become necessary to examine the question again, and see how far, if at all. the interpretation given in Sharma 's Case(1) requires modification. The complaint against the interpretation given in Sharma 's Case(1) is that it does not solve the problem as to what the words "to be a witness mean; but merely postpones the difficulty, of solving it by substituting the words "to furnish evidence" for the words, "to be a witness". It throws no light. it is said, on what is "furnishing evidence", and unless that is clear, little is gained by saying that "to be a witness" is to "furnish evidence". Rival interpretations were suggested before us which it was claimed on behalf of the protagonists will solve the problem once for all. (1) ; 40 One of the propositions put forward was that "to be a witness" as used in article 20(3) cannot refer to anything said or done at the stage of investigation of an offence. We agree with our learned brethren that this is an unduly narrow construction. As was pointed out in Sharma 's Case(1) the phrase used in article 20(3) is "to be a witness" and not "to appear as a witness". That by itself justifies the conclusion "that the protection afforded to an accused in so far as it is related to the phrase "to be a witness" is not merely in respect of testimonial compulsion in the court room but may well extend to compelled testimony previously obtained from him". If the protection was intended to be confined to being a witness in Court then really it would have been an idle protection. It would be completely defeated by compelling a person to give all the evidence outside court and then, having what he was so compelled to do, proved in court through other witnesses. An interpretation which so completely defeats the constitutional guarantee cannot, of course, be correct. The contention that the protection afforded by article 20(3) is limited to the stage of trial must therefore be rejected. That brings us to the suggestion that the expression "to be a witness" must be limited to a statement whether oral or in writing by an accused person imparting knowledge of relevant facts; but that mere production of some material evidence, whether docum entary or otherwise would not come within the ambit of this expression. This suggestion has found favour with the majority of the Bench; we think however that this. is an unduly narrow interpretation. We have to remind ourselves that while on the one hand we 'should bear in mind that the Constitution makers could not have intended to stifle legitimate modes of investigation we have to remember further that quite clearly they thought that certain things should not be (1) ; 41 allowed to be clone, during the investigation, or trial, however helpful they might seem to be to the unfolding of truth and an unnecessary apprehension of disaster to, the police system A and the administration of justice, should not deter us from giving the words their proper meaning. appears to us that to limit the meaning of the words "to be a witness" in article 20(3) in the manner suggested would result in allowing compulsion to be used in procuring the production from the accused of a large number of documents, which are of evidentiary value, sometimes even more so than any oral statement of a witness might be. Suppose, for example, an accused person has in his possession, a letter written to him by an alleged co conspirator in reference to their common intention in connection with the conspiracy for committing a particular offence. Under section 10 of the Evidence Act this document is the relevant fact as against the accused himself for the purpose of proving the existence of the conspiracy and also for the purpose of showing that any such person was a party to it. By producing this, the accused will not be imparting, any personal knowledge of facts; yet it would certainly be giving evidence of a relevant fact. Again, the possession by an accused of the plan of a house where burglary has taken place would be a relevant fact under s.8 of the Evidence Act as showing preparation for committing theft. By producing this plan is he not giving evidence against himself ? To a person not overburdened with technical learning, the giving of evidence, would appear to be the real function of a witness. Indeed English literature is replete with instances of the use of the word "witness" as meaning " 'evidence." To give one example ; Shakespeare 's Horatio speaking to Hamlet says: 42 "Season your admiration for a while with an attent ear, till I may deliver, Upon the witness of these gentlemen, This marvel to you" (Hamlet, Act I, Scene, III) There can be no doubt that to the ordinary user of English words, the word ,,witness" is always associated with evidence, so that to say that to be a witness is to furnish evidence is really to keep to the natural meaning of the words. But, what is the purpose of evidence ? Section 3 of the Indian Evidence Act defines evidence thus "Evidence means and includes (1) all statements which the Court permits or requires to be made before it by witnesses, in relation to matters of fact under inquiry; such statements are called oral evidence; (2) all documents produced for the inspection of the Court; such documents are called documentary evidence. " Section 5 states that evidence may be given in any, suit or proceeding of the existence or non existence of every fact in issue and of such other facts as are "hereinafter declared to be relevant and of no others." Then follow several sections laying down what are relevant facts. It is clear from the scheme of the various provisions, dealing with the matter that the governing idea is that to be evidence, the oral statement or a statement contained in a document, shall have a tendency to prove a fact whether it be a fact in issue or a relevant fact which is sought to be proved. Though this definition of evidence is in respect of proceedings in Court it will be proper, once we have come to the conclusion, that the protection of article 20(3) is available even at the stage of investigation, to hold that at that 43 stage also the purpose of having a witness is to obtain evidence and the purpose of evidence is to prove a fact. The illustrations we have given above show clearly that it is not only by imparting of his knowledge that an accused person assists the proving of a fact; he can do so even by other means. , such as the production of documents which though not containing his own knowledge would have a tendency to make probable the existence of a fact in issue or a relevant fact. Much has been written and discussed in England and America as regards the historical origin and development of the rules against '. 'testimonial compulsion". These matters of history, however, interesting they be, need not detain us and we must also resist the temptation of referring to the numerous cases especially in America where the concept of " 'testimonial compulsion" has been analysed. It is sufficient to remember that long before our Constitution came to be framed the wisdom of the policy underlying these rules had been well recognised. Not that there was no view to the contrary; but for long it has been generally agreed among those who have devoted serious thought to these problems that few things could be more harmful to the detection of crime or conviction of the real culprit, few things more likely to hamper the disclosure of truth than to ' allow investigators or prosecutors to slide down the easy path of producing by compulsion, evidence, whether oral or documentary, from an accused person. It has been felt that the existence of such an easy way would tend to dissuade persons in charge of investigation or prosecution from conducting diligent search for reliable independent evidence and from sifting of available materials with the care necessary ascertainment of truth. If it is permissible in law to obtain evidence from the 44 accused person by compulsion, why tread the bard path of laborious investigation and prolonged examination of other men, materials and documents? It has been well said that an abolition of this privilege would be an incentive for those in charge of enforcement of law "to sit comfortably in the shade rubbing red pepper into a poor devil 's eyes rather than to go about in the sun hunt ' up evidence". (Stephen., History of Criminal Law, p. 442). , No less serious is the danger that some accused persons at least, may be induced to furnish evidence against themselves which is totally false out of sheer despair and an anxiety to avoid an unpleasant present. Of all these dangers the Constitution makers were clearly well aware and it was to avoid them that article 20 (3) was put in the Constitution, It is obvious however that these dangers remain the same whether the evidence which the accused is compelled to furnish is in the form of statements, oral or written about his own knowledge or in the shape of documents or things, which though not trans mitting knowledge of the accused person directly helps the Court to come to a conclusion against him. If production of such documents, or things is giving evidence, then the person producing it is being a witness, on what principle or reason can it be said that, this does not amount to ' being a witness" within the meaning of article 20 (3) ? We find none. We can therefore find no justification for thinking that ",to be a witness" in article 20 (3) means to. impart personal knowledge and find no reason for departing from what this Court said in Sharma 's Case(1) that "to be a witness" is nothing more than "to furnish evidence", and such evidence be furnished through lips or by production of a thing or of a document or in other modes. The question then is :. Is an accused person furnishing evidence when he. is giving his specimen (1) ; 45 handwriting or impressions of his fingers, or palm or foot ? It appears to us that he is : For, these are relevent. facts, within the meaning of section 9 and a. 11 of the Evidence Act. Just as an accused person is furnishing evidence and by doing so, is being a witness, when he makes a statement that he did something, or saw something, so also he is giving evidence and so is being a "witness", when he produces a letter the contents of which are relevant under s.10., or is, producing the plan of a house where a burglary has been committed or is giving his specimen handwriting or impressions of his finger, palm or foot. It has to be noticed however that article 20 (3) does not say that an accused person shall not be compelled to be a witness. It says that such a person shall not be, compelled to be a witness against himself. The question that arises therefore is : Is an accused person furnishing evidence against himself, when he gives his specimen handwriting, or impressions of his fingers, palm or foot 9 The answer to this must, in our opinion, be in the negative. The matter becomes clear, when we contrast the giving of such handwriting or impressions, with say, the production of a letter admissible in evidence under section 10, or the production of the plan of a burgled house. In either of these two latter cases, the evidence given tends by. itself to incriminate the accused person. But the evidence of specimen handwriting or the impressions of the accused person 's fingers, palm or foot, will incriminate him, only if on comparison of these with certain other handwritings or certain other impressions. , identity between the two sets is established. By themselves, these impressions or the handwritings do not incriminate the accused person., or even tend to do so. That is why it must be held that by giving these impressions or specimen handwriting, the accused person does not furnish evidence against himself, So when an 46 accused person is compelled to give a specimen handwriting or impressions of his finger,pahm or foot, it may be said that he has been compelled to be a witness ; it cannot however be said that he has been compelled to be a witness against himself. This view, it may be pointed out, does not in any way militate against the policy underlying the rule against "testimonial compulsion" we have already discussed above. There is little risk, if at all, in the investigator or the prosecutor being induced to lethargy or inaction because he can get such handwriting or impressions from an accused person. For, by themselves they are of little or of no assistance to bring home the guilt of an accused. Nor is there any chance of the accused to mislead the investigator into wrong channels by furnishing false evidence. For, it is beyond his power to alter the ridges or other characteristics of his hand, palm or finger or to alter the characteristics of his handwriting. We agree therefore with the conclusion reached by the majority of the Bench that there is no infringement of Art.20(3) of the Constitution by compelling an accused person to give his specimen handwriting or signature; or impressions of his fingers, palm or foot to the investigating officer or under orders of a court for the purpose of comparison under the provisions of s.73 of the Indian Evidence Act; though we have not been able to agree with the view of our learned brethren that ,to be a witness" in Art.20(3) should be 'equated with the imparting of personal knowledge or that an accused does not become a witness when he produces some document not in his own hand writing even though it may tend to prove facts in issue or relevant facts against him. In Criminal Appeals Nos. 110 & Ill of 1958 a further question as regards the validity of s.27 of 47 the Evidence Act was raised. It was said that the receipt of information from an accused person in the custody of a police officer which can be proved under s.27 is an infringement of Art.20(3). Section 27 provides that when any fact is deposed to as discovered in consequence of Information received from a person accused of any offence, in the custody, of a police officer, so much of the information, whether it amounts to a confession or not, as relates distinctly to the fact thereby discovered, may be proved. It cannot be disputed that by giving such information the accused furnishes evidence and therefore is a "witness" during the investigation. Unless however he is " 'compelled" to give the information he cannot be said to be "compelled" to be a witness; and so article 20(3) is not infringed. Compulsion is not however inherent in the receipt of information from an accused person in the custody of a police officer. There may be cases where an accused in custody is compelled to give the information later on sought to be proved under s.27. There will be other cases where the accused gives the information without any compulsion. Where the accused is compelled to give information it will be an infringement of article 20(3); but there is no such infringement where he gives the information without any compulsion. Therefore, compulsion not being inherent or implicit in the fact of the information having been received from a person in custody, the contention that section 27 necessarily infringes Art.20(3) cannot be accepted. A question was raised in the course of the discussion as to when a person can be said to have been " 'compelled" within the meaning of Art.20(3). One view is that there must be an element of constraint or coercion in the physical sense before it can be said that an accused person has been "compelled". The other view is that in addition to cases where there has been such constraint or coercion an accused should be said to have been 48 ",compelled" to be a witness whenever there has been inducement or promise which persuaded the accused to be a witness, even though there has been no such coercion or constraints In Criminal Appeals Nos. 110 and 111 the information proved under s.27 of the Evidence Act was that Pokhar Singh had buried certain fire arms in village Badesra under Toori and these were recovered when he pointed these out to the investigating police officer. This information was proved under s.27. But it does not appear to have been suggested that the accused was made to give this information by inducement or threat or promise. On the facts therefore there is no question of the information having been received by compulsion. The question whether any inducement or promise which leads an accused person to give information amounts to compulsion or not, does not therefor fall to be decided. It may be pointed out that in the other appeals, viz., Criminal Appeal No. 146 of ' 1958 and Criminal Appeal No. 174 of 1959, also, this question does not arise for consideration in view of our conclusion that in any case the accused does not become a " 'witness against himself by giving his Specimen signatures or impressions of his fingers or Palms. It appears to us to be equally unnecessary to decide another question which was mooted in the course of the hearing, viz., whether the prohibition of Art.20(3) operates only after a person has been accused of an offence or even before that stage. Admittedly, in all these cases the person on whose behalf the protection under article 20(3) is claimed gave the specimen signatures or impressions of fingers or palms after he had been actually accused of an offence. We think it right therefore not to express any opinion on any of these questions.

Section 73 of the Indian Evidence Act empowers the court to, obtain specimen writing or signature and finger impressions of an accused person for purposes of Comparison. 11 Sections 5 and 6 of the Identification of Prisoners Act empower a Magistrate to obtain the photograph or measurements of an accused person. Section 27 of the Indian Evidence Act permits the reception in evidence of statements made by an accused person in police custody which lead to a discovery. It was contended by the accused persons that the obtaining of evidence in any of these ways amounted to compelling the person accused of an offence "to be a witness against himself" in contravention of article 20(3) of the Constitution. It was further contended that it 'was implicitly the fact that the accused was in police custody when ' the specimen signatures or thumb impressions etc. were obtained that compulsion was used. Held, that there was no infringement of article 20(3) of the Constitution in compelling an accused person to give his specimen handwriting or signature, or impressions of his thumb, fingers, palm or foot to the investigating officer or under orders of a court for the purposes of comparison. Held, further, that the provisions of section 27 of the Indian Evidence Act did not offend article 20(3) unless compulsion was used in obtaining the information. Compulsion was not inherent in the receipt of information from an accused person in the custody of a lice officer; it will be a question of fact in each case to be determined by the court on the evidence before it whether compulsion had been used in obtaining the information. M.P. Sharma vs Satish Chandra, ; , reconsidered. Per Sinha, C.J., Imam, Gajendragadkar, Subba Rao, Wanchoo, Raghubar Dayal, Rajagopala Ayyangar and Mudholkar, jj. The correct position with respect to the guarantee under article 20(3) is that (i) the guarantee includes not only oral testimony given in court or out of court but also statements in writing which incriminate the maker when figuring as an accused person; (ii) the words "to be a witness" in article 20(3) do not include the giving of thumb impression or impression of palm, foot or fingers or specimen writing or exposing a part of the body by an accused person for identification; (iii) "self incrimination" means conveying information based upon the personal knowledge of the given and does not include the mere mechanical process of 12 producing documents in court which do not contain ' any statement of the accused based on his personal knowledge; (iv) in order to come within the prohibition of article 20(3) the testimony must be of such a character that by itself it should have the, tendency to incriminate the accused; and (V) to avail of the protection of article 20(3) the person must have stood in the character of an accused person at the time he made the statement. Per section K. Das, Sarkar and Das Gupta, JJ. (i) The protection afforded by article 20(3) is not merely in respect of testimonial compulsion in the court room but extends also to compelled testimony previously obtained from the accused. (ii) The words "to be a witness" in article 20(3) mean,, to furnish evidence" and cannot be confined to imparting personal knowledge; such evidence can be furnished through lips or by production of a thing or of a document or in other modes. (iii) An accused person furnishes evidence when he gives his specimen handwriting or impressions of his fingers or palm or foot. (iv) But in doing so the accused does not furnish evidence against himself as by themselves these specimens or impressions do not incriminate or even tend to incriminate the accused and he cannot be said to be compelled "to be a witness against himself " when he is compelled to give the specimen or impression.

Appeal No. 86 of 1959. Appeal by special leave from the judgment and order dated March 27, 1957, of the Patna High Court in Appeal from Original Decree No. 359 of 1948. A. V. Viswanatha Sastri and section P. Varma, for the appellant. 882 H. N. Sanyal, Additional Solicitor General of India, R. Ganapathy Iyer and T. M. Sen, for the respondent. July, 24. The Judgment of the Court was delivered by SHAH, J. Bikhraj Jaipuria hereinafter called the appellant is the sole proprietor of a grocery business conducted in the name and style of "Rajaram Vijai Kumar" in the town of Arrah in the State of Bihar. In the months of July and August, 1943, the, Divisional Superintendent, East Indian Railway under three " 'purchase orders ' agreed to buy and the appellant agreed to sell certain quantities of food grains for the employees of the East Indian Railway. The 'following table sets out the purchase prices, the commodities, the dates of purchase orders, the quantities and the rates and the method of supply. Purchase Date of Kinds Quantity Rates. Order purchase of of No. orders. commo commo dity. dities. (1) (2) (3) (4) (5) 69. 20 7 1943. Gram 1st 1000 mds. @ Rs. 15/ quality. per md. (plus cost of new bags not exceeding Rs. 75/ per 100 bags) F.O.R. any E.I.Rly. sta tion in Bihar. :4 7 1943. Rice 1000 mds. @ Rs. 22 8 0 Dhenki (plus cost of Medium bags not ex quality. ceeding Rs.75 883 (1) (2) (3) (4) (5) per cent) per md. F.O.R. any station on the division. Wheat 5000 mds. @ Rs. 20 8 0 white per md. with as per bags F.O.R. sample. any station on E.I.R. on the Division. 24 8 1943. Rice 15000 mds. @ Rs. 24/ medium per md. with quality. out bags F.O.R. E.I. Rly. station in Bihar. Purchase orders Nos. 69 and 76 were signed by S.C. Ribbins, Personal Assistant to the Division at Superintendent and purchase order No. 106 was signed by the Divisional Superintendent. Under the purchase orders delivery of grains was to commence within seven days ' of acceptance and was to ' be completed within one month. The appellant delivered diverse quantities of foodgrains from time to time but was unable fully to perform the contracts within, the period stipulated. Between July.), 20, 1943 and August of 4, 1943, he supplied 3465 maunds of rice and between September 1, 1943 and September 19, 1943 he supplied 1152 maunds 35 seers of wheat. In exercise of the powers conferred by cl.(b) of Sub r. (2) of r.81 of the Defence of India Rules, the Government of Bihar by notification No. 12691 P.C. dated September 16, 1943 directed that commodities named in column I of the schedule shall not, from and including September 20, 1943 and until further notice, be sold at any primary source of supply or by the proprietor, manager or employee of any mill in the Province of Bihar at prices exceeding those 884 specified in the second column of the schedule. The controlled rat . of rice (medium) was Rs. 18/ per standard maund, of wheat (red) Rs. 17/ , of wheat (white) Rs. 18/ and of gram Rs. 12 8 0. The Sub Divisional Magistrate, District Arrah issued on September 21, 1943, a price list of controlled articles fixing the same prices as were fixed for wheat, rice and gram by the notification issued by the Government of Bihar. By cl. (2) of the notification, a warning was issued that in the event of the dealers selling controlled articles at rates exceeding those fixed or with holding stocks of such articles from sale, "they will be liable to prosecution under r.81 (1) of the Defence of India Rules. " By a telegraphic communication dated Sep. tember 28, 1943, the Divisional Superintendent informed the appellant that under the purchase orders, foodgrains tendered for delivery will not, unless despatched before October 1, 1943, be accepted, and barring a consignment of 637 maunds 20 seers accepted on October 7, 1943, the Railway Administration declined to accept,delivery of food grains offered to be supplied by the appellant after October 1, 1943. The appellant served a notice upon the Divisional Superintendent coraplaining of breach of contract and sold between February la and February 23, 1944 the balance of foodgrains under the purchase orders which were lying either at the various railway stations or in his own godowns. The appellant then called upon the Railway Administration to pay the difference between the price realised by sale and the contract price and failing to obtain satisfaction, commenced an action (Suit No. 359/48A) in the court of the First Additional Subordinate Judge, Patna for a decree for Rs. 2,89,995 15 3 against the Dominion of India. The appellant claimed Rs. 2,32,665 12 0 being the difference between the contract price and the price realised, Rs.42,709 10 3 as interest and Rs. 14,620 9 0 as freight, wharf. 885 age, cartage, price of packing material, labour charges and costs incurred in holding the sale. The appellant submitted that under the terms of the purchase orders, supply was to commence within seven days of the date of receipt of the orders and was to be completed within one month, but it was not intended that time should be of the essence of the contract, and in the alternative that the Railway Administration had waived the stipulation as to time in the performance of the contracts and therefore he was entitled, the Railway Administration having committed breach of ,the contracts, to recover as compensation the difference between the contract price and the price for which the grains were sold. The suit was resisted by the Dominion of India contending inter alia that the appellant had no cause of action for the claim in the suit, that the contracts between the appellant and the Divisional Superintendent Dinapur were not valid and binding upon the Government of India and that the contracts were liable to be avoided by the Government, that time was of the essence of the contracts, that stipulations as to time were not waived, and that no breach of contract was committed by the East Indian Railway Administration and in any event, the appellant had not suffered any loss as a result of such breach. By the written statement, it wag admitted that the East Indian Railway through the Divisional Superintendent, Dinapur had by three orders set out in the plaint agreed to buy and the appellant had agreed to sell the commodities specified therein, but it was denied that the Divisional Superintendent had been ""given complete authority to enter into contracts for the supply of foodgrains. " The trial court held that time was not of the essence of the contracts and even if it was, breach of the stipulation in that behalf was waived. It further_held that the plea that the contracts were void because they were not in accordance with the 886 provisions of section 175 (3) of the Government of India Act, 1935, could not be.permitted to be urged, no such plea having been raised by the written statement. Holding that the Divisional Superintendent was authorised to enter into the contracts for purchase of foodgrains, and that he had committed breach of contracts the trial Judge awarded to the appellant Rs. 1,29,460 7 0 with interest thereon at the rate of 6% per annum from October 1, 1943, to the date of the institution of the suit and further interest at 6% on judgment. Against that decree, an appeal was preferred by the Union of India to the High Court of Judicature at Patna and the appellant filed cross objections to the decree appealed from. The High Court held that time was of the essence of the contracts, but the Railway Administration having a accepted the goods tendered after the expiration of the period prescribed thereby, the stipulation as to time was waived. The High Court further held that by the notification under r. 81 of the Defence of India Rules, performance of the contracts had not been rendered illegal but the Divisional Superintendent had no authority to enter into contracts to purchase food grains on behalf of the Railway Administration and that in any event, the contracts not having been expressed to be made by the Governor General and not having been executed on behalf of the Governor General by an officer daily appointed in that behalf and in manner prescribed, the contracts were unenforceable. The High Court also held that the appellant was not entitled to a decree for compensation because he had failed to prove the ruling market rate on the date of breach viz, October 1, 1943. The High Court also observed that the trial court erred in awarding interest prior to the date of the suit and in so holding, relied upon the judgment of the Privy Council in Bengal Nagpur Railway Co., Ltd. vs Ruttanji Ramji and others (1). (1) L. R. (1938) 65 J. A. 66. 887 In this appeal by the appellant, two questions fall to be determined, (1) whether relying upon the purchase orders signed by the Divisional Superintendent which were not made and executed in the manner prescribed by s.175 (3) of the, Government of India Act 1935, the appellant could sue the Dominion of India for compensation for breach of contract, and (2) whether the appellant has proved the ruling market rate on October 1, 1943 for the commodities in question. , The finding that the Railway Administration had waived the stipulation as to the performance of the contracts within the time prescribed though time was under the agreement of the essence, is not challenged before us on behalf of the Union of India. If the finding as to waiver is correct, manifestly by his telegraphic intimation dated September 28, 1943, that the foodgrains not despatched before October 1, 1943, will not be accepted the Divisional Superintendent committed a breach of the contract. Section 175 (3) of the Government of India Act as in force at the material time provided : "Subject to the provisions of this Act, with respect to the Federal Railway Authority, all contracts made in the exercise of the executive authority of the Federation or of a Province shall be expressed to be made by the Governor General, or by the Governor of the Province, as the case may be, and all such contracts and all assurances of property made in the exercise of that authority shall be executed on behalf of the Governor General or Governor by such persons and in such manner as he may direct or authorise. " The Federal Railway Authority had not come. into being in the year 1943: it was in fact never set up. The contracts for the supply of foodgrains were undoubtedly_ made in the exercise of executive 888 authority of the Federation. The contracts had therefore under section 175(3), (a) to be expressed to be made by the Governor General, (b) to be executed on behalf of the Governor General, and (e) to be execrated by officers duly appointed in that behalf and in such manner as the Governor General may direct or authorise. But no formal contracts were executed for the supply of foodgrains by the appellant : he had merely offered to supply foodgrains by letters addressed to the Divisional Superintendent and that officer had by what are called "purchase orders" accepted those offers. These purchase orders were not expressed to be made in the name of the Governor General and were not executed on behalf of the Governor General. The purchase orders were signed by the Divisional Superintendent either in his own hand or in the hand of his Personal Assistant. In the first instance it has to be considered whether the Divisional Superintendent had authority to contract on behalf of the Railway Administration for buying foodgrains required by the Railway Administration. By Ex. M 2 which was in operation at the material time, all instruments relating to purchase or hire, supply and conveyance of materials, stores, machinery, plant, telephone lines and connections, coal etc. could be executed amongst others by the Divisional Superintendent; but contracts relating to purchase of foodgrains are not covered by that authority. Under item 34 which is the residuary item, all deeds and instruments relating to railway matters other than those specified in items 1 to 33 may be executed by the Secretary of the Railway Board. It is common ground that there is no other item which specifically authorises the making and execution of contracts relating to purchase of foodgrains; deeds and instruments relating to purchase of food grains therefore fall within item 34. The Secretary to the Railway Board had not executed these purchase orders : but the trial Court held 889 that the Divisional Superintendent was authorised to enter into contracts with the appellant for the supply of foodgrains. In so holding, the trial judge relied upon the evidence of Ribbins, Grain Supply Officer and Personal Assistant to the Divisional Superintendent, Dinapur. The High Court disagreed with that view. The High Court observed that the authority of the officer acting on behalf of the Governor General "must be deduced from the express words of the Governor General himself expressed by rules framed or by notification issued, under section 175(3). No notification has been produced in this case showing that the Divisional Superintendent had been authorised by the Governor General to execute such contracts on his behalf, nor has any rule been produced which conferred authority upon the Divisional Superintendent to make such contracts. " After referring to paragraph 10 of the notification, exhibit M 2 items 1 to 34, the High Court observed: "Therefore this notification rather shows that the Divisional Superintendent had no authority to execute the contracts for the purchase of food grains." In our view, the High Court was in error in holding that the authority under section 175(3) of the Government of India Act, 1935 to execute the contract could only be granted by the Governor General by rules expressly promulgated in that behalf or by formal notifications. This court has recently held that special authority may validly be given in respect of a particular contract or contracts by the Governor to an officer other than the officer notified under the rules made under section 175(3). In The State of Bihar vs M/s. Karam Chand Thapar and Brothers Ltd.(,), Venkatarama Aiyar J. speaking for the court observed : (1) ; 890 It was further argued for the appellant that there being a Government notification of a formal character we should not travel outside it and find authority in a person who is not authorised thereunder. But section 175 (3) does not prescribe any particular mode id which authority must be conferred. Normally, no doubt, such conferment will be by notification in the Official Gazette, but there is nothing in the section itself to preclude authorisation being conferred ad hoc on any person, and when that is established, the requirements of the section must be held to be satisfied." In that case, an agreement to refer to arbitration on behalf of the Government of Bihar was executed by the Executive Engineer whereas by the notification issued by the Government of Bihar under s.175 (3) all instruments in that behalf had to be executed by the Secretary or the Joint Secretary to the Government. This Court on a consideration of the correspondence produced in the case agreed with the High Court that the Executive Engineer had been specially authorised by the Governor acting through his Secretary to execute the agreement for reference to arbitration. Section 175 (3) in terms does not provide that the direction or authority given by the Governor General or the Governor to a person to execute contracts shall be given only by rules or by notifications, and the High Court was in our judgment in error in assuming that such authority can be given only by rules expressly framed or by formal notifications issued in that behalf. In para 5 of the plaint, the appellant pleaded: " 'That for the purposes and under the authority conferred as noted in the para 3 above in July and August, 1943 the said E. 1. through its then Divisional Superintendent, Dinapur, by three diverse orders agreed to buy and the plaintiff agreed to sell the following commodities at the rates mentioned against them, 891 By para 3 of the written statement, the Dominion of India accepted the allegations made in para 5 of the plaint. It is true that by paragraph 1, the authority of the Divisional Superintendent to enter into contract with, trading firms dealing in foodgrains for the supply of foodgrains was denied and it was further denied that the Divisional Superintendent "was invested with complete authority to enter into contracts for the purchase of food supplies and to do all that was necessary in that connection. " There was some inconsistency between the averments made in paragraphs 1 and 3 of the written statement, but there is no dispute that the purchase orders were issued by the Divisional Superintendent for and on behalf of the East Indian Railway Administration. Pursuant to these purchase orders, a large quantity of foodgrains was tendered by the appellant: these were accepted by the Railway Administration and, payments were made to the appellant for the grains supplied. Employees of the Railway Administration wrote letters to the appellant calling upon him to intimate the names of the railway stations where grains will be delivered and about the date when the supply. will commence. They fixed programmes for inspection of the goods, kept 'wagons ready for accepting delivery, held meetings on diverse occasions for settling programmes for the supply of grains, rejected grains which were not according to the contract, entered into correspondence with the appellant about the return of empty bags accepted bills and railway receipts and made pay ments, returned certain bills in respect of the grains tendered beyond the period of contract and did diverse other acts in respect of the goods which could only be consistent with the contracts having been made with the authority of the Railway Administration granted to the Divisional Superintendent. There is also the evidence of Ribbins which clearly supports the vie* that the agreements to purchase foodgrains by the Divisional 892 Superintendent were part of a. scheme devised by the Railway Administration at the time of the, serious famine in 1943 in Bengal. In cross examination, Ribbins stated: "When the Bengal famine arose in April May 1943, the (necessity for a scheme of) arrangement of supplying foodgrains to E. I. Railway employees arose . A scheme was drawn up for carrying out this work in writing. In other words orders were received from Head Office Calcutta about it. The Deputy General Manager, Grains, Calcutta issued the necessary orders . The agent or General Manager as he is called appropriated the above functionary. He must have done so presumably under orders . The entire scheme did subsequently get the assent of the Railway Board. From time to time order came with instruction from Head Office. All such directions should be in the office of D. Supdt., Dinapur. Some posts had to be created for carrying out this scheme. Originally one post of Asstt. Grain Supply Officer was created. Subsequently, two posts were created one on a senior scale and the other as Asstt. in Dinapur Dv. staff had to be appointed to be in charge of the grain shops. They were exclusively appointed to work the grain shop Organisation. The Railway made some arrangement in some places for accommodation and additional storage. Grain shops were located At these places when accommodation was made for additional storage. " Ribbins was for some time a Grain Supply Officer under the East Indian Railway and he admitted that orders similar.to the purchase orders in question in this litigation were drawn up in cyclostyled forms "as per orders from the Head Office. " The witness stated that the instructions of the Head Office were "in the office file". None of these documents were, however, produced or tendered in evidence by the Railway Administration. 893 The evidence on the whole establishes that with a view to effectuate the scheme devised by the Railway Board for distributing foodgrains to their employees at concessional rates, arrangements were made for procuring foodgrains. This scheme received the approval of the Railway Board and Railway Officers were authorised to purchase, transport and distribute foodgrains. If, in the implementation of the scheme, the foodgrains were received by the Railway Administration, special wagons were provided and goods were carried to different places and distributed and payments were made for the foodgrains received by the Railway Administration after testing the supplies, the inference is inevitable that the Divisional Superintendent who issued the purchase orders acted with authority specially granted to him. The evidence of Ribbins supported by abundant docu mentary evidence establishes beyond doubt that the Divisional Superintendent though not expressly authorised by the notification exhibit M 2 to contract for the purchase of foodgrains, was specially authorised to enter into these contracts for the purchase of foodgrains. The question still remains whether the purchase orders executed by the Divisional Superintendent but which were not expressed to be made by the Governor General and were not executed on behalf of the Governor General, were binding on the Government of India. Section 175(3) plainly requires that contracts on behalf of the Government of India shall be executed in the form prescribed thereby ; the section however does not set out the consequences of non compliance. Where a statute requires that a thing shall be done in the prescribed manner or form but does not set out the consequences of non compliance, the question whether the provision was mandatory or directory has to be adjudged in the light of the intention of the legislature as disclosed by the 894 object, put pose and scope of the statute. If the statute is mandatory, the thing done not in the manner or form prescribed can have no effect or validity : if it is directory, penalty may be incurred for non compliance, but the act or thing done is regarded as good. As observed in Maxwell on Interpretation of Statutes 10th Edition p. 376 : "It has been said that no, rule can be laid down for determining whether the command is to be considered as a mere direction or instruction involving no invalidating consequences in its disregard, or as imperative, with an implied nullification for disobedience, beyond the fundamental one that it depends on the scope. and object of the enactment. It may perhaps be found generally correct to say that nullification is the natural and usual consequence of disobedience, but the question is, in the main governed by considerations of convenience and justice, and when that result would involve general inconvenience or injustice to innocent persons, or advantage to those guilty of the neglect, without promoting the real aim and object of the enactment such an intention is not to be attributed to the legislature. The whole scope and purpose of the statute under consideration must be regarded. " Lord Campbell in Liverpool Borough Bank vs Turner(1) observed "No universal rule 'can be laid down as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience. It is the duty of Court of justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed. " It is clear that the Parliament intended in enacting the provision contained in section 175(3) that (1) ; 895 the State should not be saddled with liability for unauthorised contracts and with that object provided that the contracts must show on their face that they are made on behalf of the State, i. e., by the Head of the State and executed on his behalf and in the manner prescribed by the person authorised. The provision, it appears, is enacted in the public interest, and invests public servants with authority to bind the State by contractual obligations incurred for the purposes of the State. It is in the interest of the public that the question whether a binding contract has been made between the State and a private individual should not be left open to dispute and litigation ; and that is why the legislature appears to have made a provision that the contract must be in writing and must on its face show that it is executed for and on behalf of the head of the State and in the manner prescribed. The whole aim and object of the legislature in conferring powers upon the head of the State would be defeated if in the case of t contract which is in form ambiguous, disputes are permitted to be raised whether the contract was intended to be made for and on behalf of the State or on behalf of the person making the contract. This consideration by itself would be sufficient to imply a prohibition against a contract being effectively made otherwise than in the manner prescribed. Itm is true that in some cases, hardship may result to a person not conversant with the law who enters into a contract in a form other than the one prescribed by law. It also happens that the Government contracts ,ire sometimes made in disregard of the forms prescribed ; but that would not in our judgment be a ground for holding that departure from a provision which is mandatory and at the same time, salutary may be permitted. There is a large body of judicial opinion in the High Courts in India on the question whether 896 contracts not ill form prescribed by the Constitution Acts are binding upon the State. The view has been consistently expressed that the provisions, under the successive Constitution Acts relating to the form of contract between the Government and the private individual are mandatory and not merely directory. In Municipal Corporation of Bombay vs Secretary of State (1), the true effect of section 1 of Si. 22 and 23 Vic. c. 41 fell to be determined. The Governor General of India in Council and the Governors in Council and officers for the time being entrusted with the Government were, subject to restrictions prescribed by the Secretary of State in Council, empowered to sell and dispose of real and personal estate vested in Her Majesty and to raise money on such estate and also to enter into contracts within. the respective limits for the purposes of the Act. it was provided that the Secretary of State in Council. may be named as a party to such deed, contract, or instrument and the same must be expressed to be made on behalf of the Secretary of State in Council by or by the order. of the Governor General in Council or Governor in Council, but may be executed in other respects in like manner as other, instruments executed by or on behalf of him or them respectively in his or their official capacity, and may be enforced by or against the Secretary of State in Council for the time being. In a suit between the Government of Bombay and the Municipal Corporation of Bombay, the latter claimed that it was entitled to remain in occupation on payment of a nominal rent, of an extensive piece of land because of a resolution passed by the Government of Bombay sanctioning such user. Jenkins C. J. in delivering the judgement of the Court observed. "I think that a disposition in 1865 of Crown ' (1) I. L. R. 897 lands by the Governor in Council was dependent for its validity on an adherence to the forms prescribed, and that therefore the Resolution was not a valid disposition of the property for the interest claimed. " In Kessoram Poddar and Co. vs Secretary of State for India (1), it was held that in order that a contract may be binding on the Secretary of State in Council., it must be made in strict conformity with the provisions laid down in the statute governing the matter and if it is not so made, it is not valid as against him. The same view was expressed in section C. Mitra and Co. vs Governor General of India in Council (2), Secretary of State vs Yadavgir Dharamgir(3), Secretary. of State and another vs G. T. Sarin and, Company U. P. Government vs Lala Nanhoo Mal Gupta Devi Prasad Sri Krishna Prasad Ltd. vs Secretary of State (6), and in section K. Sen vs Provincial P. Way D. State of Bihar(7). But Mr. Viswanatha Sastri on behalf of the appellant contended that this court in Chatturbhuj Vithaldas Jasanth vs Moreshwar Parashram (8) has held that a contract for the supply of goods to the Government which is not in the form prescribed by article 299 (1) of the Constitution which is substantially the same form as section 175 (3) of the Government of India Act, 1935) is not void and unenforceable. In that case, the election of Chatturbhuj Jasani to the Parliament was challenged on the ground that he had a share or interest in a contract for the supply of goods to the Union Government. It was found that Jasani was partner of a firm, which had entered into contracts with the Union Government for the supply of goods and these contracts subsisted on November 15, 1951 and (1) I.L.R. I.L.R. , (3) I.L.R. I.L.R. (1930) 11 Lah.375. (5) A.I.R. (1960) All. (6) I.L.R. (1941) All. 741 (7) (7) A.I.R. (1960) Pat. (8) ; 898 February 14, 1952 respectively the last date for filing nominations and the date of declaration of the results of the election. This court held that Jasani was disqualified from being elected by virtue of the disqualification set out in section 7 (b) of the Representation of the People Act 43 of 1951. The contracts in that case were admittedly not in the form Prescribed by article 299 (1) of the Constitution, and relying upon that circumstance, it was urged that the contracts were void and had in law no existence. In dealing with this plea, Bose J. speaking for the court observed : "We feel that some reasonable meaning must be attached to article 299(1). We do not think the provisions were inserted for the sake of mere form. We feel they are there to safeguard Government against unauthorised contracts. If in fact a contract is unauthorised or in excess of authority it is right that Government should be safeguarded. On the other hand, an officer entering into a contract on behalf of the Government can always safeguard himself by having recourse to the proper form. In between is a large class of contracts, probably by far the greatest in numbers, which though authorised, are for one reason or other not in proper form. It is only right that an innocent contracting party should not suffer because of this and if there is no other defect or objection we have no doubt Government will always accept the responsibility. If not, its interests are safeguarded as we think the Constitution intended that they should be. " The learned Judge also observed: "It would, in our opinion, be disastrous to hold that the hundreds of Government officers who have daily to enter into a variety of contracts, often of a petty nature, and sometimes in an emergency, cannot contract orally or through correspondence and that every petty contract must be effect ed by a ponderous legal document couched in a particular form." 899 The rationale of the case in our judgment does not support the contention that a contract on behalf of a State not in the form prescribed is enforceable against 'the State. Bose J. expressly stated that the "Government may not be bound by the contract, but that is a very different thing from saying that the contract ",as void and of no effect, and that it only meant the principal (Government) could not be sued; but there will be nothing to prevent ratification if it was for the benefit of the Government. " The facts proved in that case clearly establish that even though the contract was not in the form prescribed, the Government had accepted performance of the contract by the firm of which Jasani was a partner, and that in fact there subsisted a relation between the Government and the firm under which the goods were being supplied and accepted by the Government. The agreement between the parties could not in the case of dispute have been.enforced at law, but it was still being carried out according to its terms : and the Court held that for the purpose of the Representation of the People Act, the existence of such an agreement which was being carried out in which Jasani was interested disqualified him. It was clearly so stated when Bose J. observed: "Now section 7 (d) of the Representation of the People Act does not require that the contracts at 'which it strikes should be enforceable against the Government ; all it requires is that the contracts should be for the supply of goods to the Government. The contracts in question are just that and so are hit by the section". Reliance was also placed by counsel for the appellant upon cases decided under s.40 of the Government of India Act, 1915, which was continued in operation. even after the repeal of the Act, 1915, by the 9th schedule to the Government of India Section 40 prescribed the manner in which the business of the Governor General in Council was to be conducted. It provided that all orders and other proceedings of the Governor General in Council shall be expressed to be made by the Governor General in Council and shall be signed by a Secretary to the Government of India or otherwise as the Governor General in Council may direct and shall not be called in question in any legal proceeding on the ground that they were not duly made by the Governor General in Council. In J.K. Gas Plant Manufacturing Co., (Rampur) Ltd., vs King Emperor (1), certain persons were accused of offences committed by them in contravention of cls. (5) and (8) of the Iron and Steel (Control of Distribution) Order, 1941, which order was not expressed to be made by the Governor General in Council as required by section 40(1) of the 9th schedule to the Constitution Act. The Federal Court held that the scope and purpose of the Act did not demand a construction giving a mandatory rather than a directory effect to the words in section 40: for, in the first instance, the provision that all orders of the Governor General in Council shall be expressed to be made by the Governor General in Council did not define how orders were to be made but only how they are to be expressed; it implied that the process of making an order preceded and was something different from the expression of it. Secondly, it was observed, the provision, was not confined to orders only and included proceedings and in the case of proceedings, it was still clearly a method of recording proceedings which had already taken place in the manner prescribed rather than any form in which the proceedings, must take place if they are valid. Thirdly, it was observed, that the provision relating to the signature by a Secretary to the Government of India or other person indicated that it was a provision as (1) 901 to the manner in which a previously made order should be embodied in publishable form, and it indicated that if the previous directions as to the expression of the order and proceedings and as to the signature were complied with, the order and proceedings shall not be called in question in a court of law on one ground only. The rule contained in section 40 (1) was in the view of the court one of evidence which dispensed with proof of the authority granted by the GovernorGeneral in respect of orders or proceedings which complied with the requirements prescribed : the making of the order or the proceedings was independent of the form of the order or proceedings expressing it. But it cannot be s aid that the making of the contract is independent of the form in which it is executed. The document evidencing the contract is the sole repository of its terms and it is by the execution of the contract that the liability ex contracti of either party arises. The principle of J. K. Gas Plant Manufacturing Co. 's case has therefore no application in the interpretation of section 175 (3) of the Government of India Act, 1935. Reliance was also placed upon Dattatreya Moreshwar Pangarkar vs The State of Bombay (1) and The State of Bombay vs Purshottam Jog Naik(2). In both these cases, orders made by the Government of Bombay under the Preventive Detention Act were challenged on the ground that the orders did not comply with the requirements of article 166 of the Constitution. Article. 166 substantially prescribes the same rules for authentication of the orders of the Governor of a State as section 40 to the 9th schedule of the Government of India Act, 1935 prescribed for the authentication of the orders of the Governor General and the Governors. In the former case, this court observed that (1) ; (2) ; 902 the Preventive Detention Act contemplates and requires the taking of an executive decision for confirming a detention order under section 11 (1) and omission to make and authenticate that decision in the form set out in article 166 will not make the decision itself illegal,for the provisions in that arti cle are merely directory and not mandatory. In the latter case, an order which purported to have been made in the name of the Government of Bombay instead of the Governor of Bombay as required by article 166 was not regarded as defective and it was observed that in any event, it was open to the State Government to prove that such an order was validly made. The court in those cases therefore held that the provisions of article 166 are directory and not mandatory. , These cases proceed on substantially the same grounds on which the decision in J. k. Gas Plant and Manufacturing Co. 's case , proceeded, and have no bearing on the interpretation of section 175 (3) of the Government of India Act, 1935. Reliance was also placed upon the State of U.P. vs Manbodhan Lal Srivastava(1) in which case this court held that the provisions of article 320 el. (3) (e) of the Constitution relating to the consultation with the Public Service Commission before discharging at public servant are merely directory. The fact that certain other provisions in the Constitution are regarded as merely directory and not mandatory, is no ground for holding that the provisions relating to the form of contracts are not mandatory. It maybe said that the view that the provisions in the Constitution relating to the form of contracts on behalf of the Government are mandatory may involve hardship to the unwary. But a person who seeks to contract with the Government must be deemed to be fully aware of (1) ; 903 statutory requirements as to the form in which the contract is to be made. In any event, inadvertence of an officer of the State executing A contract in manner violative of the express statutory provision, the other contracting party acquiescing in such violation out of ignorance or negligence will not justify the court in not giving effect to the intention of the legislature, the provision having been made in the interest of the public. It must therefore be held that as the contract was not in the form required by the Government of India Act, 1935, it could not be enforced at the instance of the appellant and therefore the Dominion of India could not be sued by the appellant for compensation for breach of contracts. We are also of the view that the High Court was right in holding that the appellant failed to prove that he was entitled to compensation assuming that there was a valid and enforceable contract. The appellant claimed that he was entitled to the difference between the contract price and the price realised by sale of the foodgrains offered after October 1,1943 but not accepted by the Railway Administration. The High Court rightly pointed out that the appellant was, if at all, entitled only to compensation for loss suffered by him by reason of the wrongful breach of contract committed by the State, such compensation being the difference between the contract price and the ruling market rate on October 1,1943, and that the appellant had failed to lead evidence about the ruling market rate on October 1,1943. The trial judge held that the "control price list xxx was reliable for ascertaining the measure of damages in the case". This document was a notification relating to the controlled rates in operation in the district of Arrah, by which the sale of foodgrains at prices exceeding the rates prescribed was made an offence. The appellant had obviously the option of delivering foodgrains at an railway station F. O. R. in the Province of 904 Bihar, and there is no evidence on the record whether orders similar to exhibit M 2 were issued by the authorities in other districts of the Bihar State. But if the grains were supplied in the district of Arrah, the appellant could evidently not seek to recover price for the goods supplied and accepted on and after October 1, 1943, at rates exceeding those fixed by the notification; for, by the issue of the control orders, on the contracts must be deemed to be superimposed the condition that foodgrains shall be sold only at rates specified therein. If the grains were to be supplied outside the district of Arrah, the case of the appellant suffers from complete lack of evidence as to the ruling rates of the foodgrains in dispute on October 1, 1943. The High Court was therefore right in declining to award damages. On the view taken by us, this appeal must stand dismissed with costs. Appeal dismissed.

In the year 1943 the Divisional Superintendent, East Indian Railway placed certain purchase orders with the appellant for the supply of foodgrains for the employees of the East Indian Railway. The orders were not expressed to be made in the name of the Governor General and were not "executed on behalf of the Governor General as required by section 175 (3) of the Government of India Act, 1935. They were signed by the Divisional Superintendent either in his own hand or in the hand of his Personal Assistant. Some deliveries of foodgrain s were made under these orders and were accepted and paid for by the Railway Administration. But the Railway Administration declined to accept further deliveries of foodgrains. The appellant sold the balance of foodgrains under the purchase orders and filed a suit to recover the difference between the price realised by sale and the contract price. The respondent resisted the suit inter alia on the ground that the contracts were not binding on it. Held, that the contracts were not binding on the respondent and it was not liable for damages for breach of the contracts. Under s 175 (3) of the Government of India Act, 1935, as it stood at the relevant time, the contracts had: (a) to be expressed to be made by the Governor General, (b) to be executed on behalf of the Governor General and (F) to be executed by officers duly appointed in that behalf and in such mariner as the Governor General directed or authorised. The 881 authority to a person to execute contracts may be conferred not only by rules expressly trained and by formal notifications issued in this behalf but may also be specially conferred. The evidence in the case showed that such authority was specially conferred upon the Divisional Superintendent. But the contracts were not expressed to be made by the Governor General and were not executed on his behalf The provisions of section 175(3) were mandatory. The object of enacting these provisions was that the State should not be saddled with liability for unauthorised contracts and hence it was provided that the contracts trust show on their face that they were made by the Governor General and executed on his behalf in the manner prescribed by the person authorised. State of Bihar vs M/s. Karam Chand Thapar and Bros., Ltd. ; , followed. Liverpool Borough Bank vs Turner, ; , Municipal Corporation of Bombay vs Secretary of State, I. L. R. , Kessoram Poddar and Co., vs Secretary of State for India, I. L. R. section C. Mitra and Co., vs Governor General of India in Council, I.L.R. , Secretary of State vs Yadavgir Dharamgir, I. L. R. , Secretary of State vs G.T. Sarin and Co., 1. L. R. , U. I '. Government vs Lal Nanhoo Mal Gupta, A. 1. R. (1960) All. 420, and Devi Prasad Sri Krishna Prasad Ltd. vs Secretary of State, I. L. R. (1941) All. 741, referred to. section K. Sen vs Provincial P. W. D., State of Bihar, A. 1. R. (1960) Pat., Chatturbhui Vithaldas Jasani vs Moreshwar Prashram, ; ,J. K. Gas Plant Mfg., Co. (Rampur) Ltd. vs King Emperor, , Moreshwar Pangarkar vs State of Bombay, ; , State of Bombay vs Purshottam Jog Naik, ; and State of U.P. vs Manbodhan Lal Srivastava, (1958) section C. R. 533, distinguished.

als Nos. 56 and 57 of 1949. Appeals from the orders of the High Court of Judica ture at Madras (Wadsworth and Patanjali Sastri JJ.) dated 24th October, 1945, in A.A.O. Nos. 372 of 1943 and 634 of 1944 which were appeals from the orders of the Subordinate Judge of Ellore in E.A. No. 440 of 1937 and C.M.P. No. 152 of 1943 in O.S. No. 87 of 1923. P. Somasundaram (V. V. Choudhry, with him) for the appellant. V. Rangachari (K. Mangachari, with him) for the respond ents. 1950. October 17. The Court delivered judgment as follows. FAZL ALI J. These appeals arise out of an execution proceeding, and the main point to be decided in them is what is the effect of certain provisions of the Madras Agricul turists ' Relief Act (Madras Act IV of 1938, which will hereinafter be referred to as "the Madras Act"), on the rights of the parties. How this point arises will be clear from a brief statement of the facts of the case. It appears that in 1908, one Veeresalingam, the husband of the first respondent, borrowed a sum of Rs. 9,000 from one Sitharamayya, and executed a mortgage bond in his fa vour. Subsequently a suit was 808 instituted by the mortgagee to enforce the mortgage and a final decree in that suit was passed on the 19th August, 1926. Thereafter, on the 28th October, 1931,the decree holder applied for the execution of the decree by the sale of the mortgaged property. In 193a, the decree holder transferred the decree to one Sobhanadri, after whose death his son, the appellant before us, was brought on the record as his legal representative in the execution proceedings. Several years before the assignment of the decree, Veeresa lingam, the defendant, had died and his widow, the first respondent. was therefore brought on the record as his legal representative. On the 6th July, 1935, two items of proper ty were sold in execution of the decree and purchased by the decree holder, these being : (1) a village called Tedlam in in West Godavari District; and (2) 4 acres and 64 cents of land in Madepalli village. The first property was sold for Rs. 21,000 and the second for ' Rs. 1,025. As, however, the amount due under the decree was only about Rs. 17,860 and odd, the sale of the second property was subsequently set aside and the decree holder deposited into Court the excess amount of about Rs. 3,000 and odd after setting off the decretal amount against the price of the first item of property. On the 5th August, 1935, the first respondent filed an application under Order XXI, rule 90, and section 47 of the Code of Civil Procedure, to set aside the sale held in July, 1935, alleging certain irregularities in the conduct of the sale. That application was after several years heard by the Subordinate Judge of Ellore, who by his order dated the 6th March, 1943, dismissed it and directed the sale of the first property to be confirmed and full satisfaction of the decree to be entered. After about 12 days, i.e., on the 18th March, 1943, the first respondent and the second respondent, who had been adopted by the former on the 12th March, 1936, under the will of her hus band and was subsequently brought on record, filed an appli cation under section 19 of the Madras Act praying for cer tain reliefs under that Act. This application ' was dismissed on the 22nd March, 1943. Subsequently, two appeals were filed on behalf 809 of the respondents (who will hereinafter be sometimes re ferred to as judgment debtors), one against the order refus ing to set aside the sale under Order XXI, rule 90 of the Civil Procedure Code, and the other against the order dis missing the application under the Madras Act. These appeals were heard together by two learned Judges of the Madras High Court and they took the view that the judgment debtors ' application under the Madras Act was maintainable notwith standing the fact that the sale had been confirmed and full satisfaction of the decree recorded, and remitted the case to the trial Court for a finding on the following questions, namely (1) whether the applicants were agriculturists; and (2) if so, what would be the result of applying the provisions of Madras Act IV of 1938 to the decretal debt against them ? So far as regards the judgment debtors ' appeal against the order dismissing their application under Order XXI, rule 90, the Learned Judges were inclined to agree with the trial Court that the sale should stand but declined to pass final orders in the appeal on the ground that "it would seriously prejudice the judgment debtors in the connected application for relief under section 19 of the Madras Act IV of 1938. " The Subordinate Judge answered the questions referred to him by the High Court on remand as follows : (1) The judgment debtors were not agriculturists and were not therefore entitled to the benefits of the Madras Act;and (2) If they were agriculturists, they were not liable to pay anything under the decree, as, in view of the provisions of the Act, the debt stood discharged on the date of sale. When however the matter came up before the learned Judges of the High Court, they reversed the first finding of the trial Court and held that the judgmentdebtors were agriculturists within the meaning of the 810 Act, and that the debt stood discharged in view of section 8 (2) of the Act. At the same time, they held that the sale was not liable to be set aside, and in this view dismissed one of the appeals and allowed the other. Then followed certain proceedings to which it would have been unnecessary to refer but for the fact that the judgment debtors have attempted to rely on "them in support of one of their preliminary objections to the maintainability of these appeals. It appears that on the next day after the judgment of the High Court was delivered in the two appeals, counsel for the respondents wrote a letter to the Registrar of the High Court to direct the posting of the two cases 'for being mentioned ' before the Court in order to obtain necessary directions consequent on the orders passed by it in the appeals. This letter was not placed before the learned Judges until the judgment had been signed by them and ac cordingly the judgment debtors filed two petitions, one being a review petition to the High Court and the other being a petition to the trial Court praying "that the de creeholder may be ordered to pay to the petitioners the purchase money of Rs. 21,000 with interest thereon at 6 per cent. per annum from the date of sale till the date of payment. " The trial Court dismissed the latter petition on the ground that it was not maintainable, and the judgment debtors filed an appeal against the order. The appeal as well as the review petition of the judgment debtors were heard together by the learned Judges who directed the decree holder 's counsel to elect whether his client would deposit the purchase money into Court or have the sale set aside. The decree holder applied for a short adjournment and ultimately on the 15th November, 1946, his counsel stated that his client wished to retain the property which he had purchased and to pay the purchase money into Court. Thereupon, he was directed to pay the sum of Rs. 21,000 together with interest within a months from that date. Subsequently, the appellant (decree holder) having obtained leave to appeal from the High Court preferred 811 these appeals before us. It may be stated here that along with the application for leave to appeal, the appellant had filed an application for excusing the delay in filing the former application which he accounted for mainly by refer ring to the proceedings for the review of the judgments in the previous appeals to the High Court. This application was granted and the delay was condoned. As has been already stated, the main point arising in these appeals relates to the effect of the Madras Act upon this litigation. That Act was passed and came into effect in 1938, while the execution proceedings were still continu ing. It will be recalled that the sale took place on the 6th July, 1935; and the application for setting it aside was not disposed of until the 6th March, 1943. But, strangely enough, the judgmentdebtors did not apply for any relief under the Madras Act during this period, and they made their application only after the sale had been confirmed and satisfaction of the decree had been entered. How far this belated application affects the right claimed by the judg ment debtors under the Act is one of the questions raised in these appeals, and I shall deal with it after referring to the material provisions of the Act and the findings of the High Court which have given rise to several debatable points. The sections of the Act which are material for the purpose of these appeals are sections 3, 8 and 19. Section 3 defines an agriculturist and has a proviso stating that in certain cases a person shall not be deemed to be an agricul turist. The relevant clause of this proviso, to which I shall also have to advert later, is clause (D) which runs thus : "Provided that a person shall not be deemed to be an 'agriculturist ' if he (D) is a landholder of an estate under the Madras Es tates Land Act, 1908, or of a share or portion thereof in respect of which estate, share or portion any sum exceeding Rs. 500 is paid as peshkash or any sum exceeding Rs. 100 is paid as quit rent, jodi, kattubadi, 812 poruppu or the like or is a janmi under the Malabar Tenancy Act, 1929, who pays any sum exceeding Rs. 500 as land reve nue to the Provincial Government. ' ' The precise question which is said to arise with refer ence to this provision is whether by reason of being the owners of village Tedlam, the judgment debtors should be held to be not entitled to relief under the Act. The other material sections 8 and 19 run as follows : "8. Debts incurred before the 1st October, 1932, shall be scaled down in the manner mentioned hereunder, namely: (1) All interest outstanding on the 1st October, 1937, in favour of any creditor of an agriculturist whether the same be payable under law, custom or contract or under a decree of Court and whether the debt or other obligation has ripened into a decree or not, shall be deemed to be dis charged, and only the principal or such portion thereof as may be outstanding shall be deemed to be the amount repay able by the agriculturist on that date. (2) Where an agriculturist has paid to any creditor twice the amount of the principal whether by way of princi pal or interest or both, such debt including the principal, shall be deemed to be wholly discharged. (3) Where the sums repaid by way of principal or inter est or both fall short of twice the amount of the principal, such amount only as would make up this shortage, or the principal amount or such portion of the principal amount as is outstanding, whichever is smaller, shall be repayable. (4) Subject to the provisions of sections 22 to 25, nothing contained in sub sections (1), (2) and (8) shall be deemed to require the creditor to refund any sum which has been paid to him, or to increase the liability of a debtor to pay any sum in excess of the amount which would have been payable by him if this Act had not been passed. 813 Explanation. Where a debt has been renewed or included in a fresh document in favour of the same creditor, the principal originally advanced by the creditor together with such sums, if any, as have been subsequently advanced as principal shall alone be treated as the principal sum repay able by the agriculturist under this section. Where ' before the commencement of this Act, a Court has passed a decree for the repayment of a debt, it shall, on the application of any judgmentdebtor who is an agricul turist or in respect of a Hindu joint family debt, on the application of any member of the family whether or not he is the judgment debtor or on the application of the decree holder, apply the provisions of this Act to such decree and shall, notwithstanding anything contained in the Code of Civil Procedure, 1908, amend the decree accordingly or enter satisfaction, as the case may be: Provided that all payments made or amounts recovered, whether before or after the commencement of this Act, in respect of any such decree shall first be applied in payment of all costs as originally decreed to the creditor. " These sections are material, because in the present case the judgment debtors asked the decree to be amended under section 19 of the Act and they were held to be entitled to relief under section 8. Having referred to the relevant provisions of the Act, it becomes necessary now to state the main findings of the High Court upon which the decision of this appeal will turn. These findings are (1) that the sale of Tedlam village, which was held on the 6th July, 1935, and confirmed on the 6th March, 19 13, was a good sale; (2) that by this sale. the title to the Tedlain village passed to the decree hoMer. and in hearing the appeal the High Court was justified in proceeding on the footing that the judgment debtors having ceased to be the owners of Tedlam village after its sale, were not 104 814 hit by clause (D) of the proviso to section a of the Act; and (3) that the decree had been satisfied at the date of the sale and the decree holder was liable to repay to the judg ment debtors the full price of the property which was sold. The main contentions directed against the conclusions arrived at by the High Court are :firstly, that they are self contradictory, because if the sale was an effective sale on the date it was held or confirmed, the decree was also satisfied on that date and the judgmentdebtors were no longer entitled to invoke the provisions of the Madras Act; and secondly, that the view taken by the learned Judges of the High Court that notwithstanding the appeal against the order refusing to set aside the sale they could proceed on the footing that the judgment debtors had ceased to be the owners of Tedlarn village on the date of the sale was un sound in law. It will first deal with the second point which appears to me to require serious consideration. The High Court has in my opinion rightly proceeded on the footing that the ownership of Tedlam village would bring the judgment debtors within the mischief of clause (D) of the proviso to section 3 of the Act, and would disentitle them to any relief thereunder. This view was contested before us on behalf of the judgment debtors on two grounds : (1) that the grant in favour of the ancestor of the judgment debtors did not comprise a whole inam village and what they owned was therefore not an estate under the Madras Estates Land Act (Madras Act I of 1908); (2) that on the date of the application, the judg ment debtxrs were not landholders of village Tedlam because the village was in the possession of a receiver since 1st February, 1937, and the latter was in law the landholder on the crucial date. None of these contentions however appears to me to have any force. The first contention was sought to be supported by Exhibit P 1 which is a register of inams and which shows that poramboke or waste lands to the extent of 596 acres had to be deducted from the area 815 of the inam. The point however has been dealt with very fully and clearly by the learned Subordinate Judge, who has rightly pointed out that it has no force in view of the Madras Estates Land (Amendment) Act, 1945 [Madras Act No. II of 1945]. The second point is equally unsubstantial, be cause it is well settled that the owner of a property does not cease to be its owner merely because it is placed in the hands of a receiver. The true position is that the receiver represents the real owner whoever he may be, and the true owner does not by the mere appointment of a receiver cease to be a landholder under the Madras Estates Land Act. I will now revert to the crucial question in the case, viz., whether the learned Judges of the High Court were justified in law in deciding the appeal on the footing that the judgment debtors had ceased to be the owners of Tedlain village and on that account they were not hit by clause (D). of the proviso to section 3 of the Madras Act. At this stage, it will be useful to refer to certain provisions of the Civil Procedure Code which directly bear on the question as to when title to immovable property which is sold in execution of a decree is deemed to pass to the purchaser. One of the provisions is Order XXI, rule 92, which provides that "where no application is made under rule 89, rule 90 or rule 91, or where such application is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute. " The second rele vant provision is section 65 which runs thus : "Where immovable property is sold in execution of a decree and such sale has become absolute, the property shall be deemed to have vested in the purchaser from the time when the property is sold and not from the time when the sale becomes absolute. " In Bhawani Kunwar vs Mathurn Prasad Singh(1) the ques tion as to when a mortgagee who has purchased certain vil lages in execution of the decree acquired title to the properties purchased by him directly arose for considera tion, and the Privy Council rightly pointed (1) T.L.R. 816 out that "the sale in execution of the mortgage decree took effect from the actual date of the sale and not from its confirmation." In a simple case, the provisions cited above should settle the controversy, but, in the present case, the matter has been complicated on account of the appeal against the order refusing to set aside the sale under Order XXI, rule 90. In such a case, generally speaking, the true position seems to be that there is no finality until the litigation is finally determined by the appellate Court. This principle has been recognized in a number of cases, but it will be enough to cite Chandramani Shaha vs Anarjan Bibi(1). The headnote of that case runs as follows : "Where a Subordinate Judge has disallowed an applica tion under Order XXI, rule 90, to set aside a sale in execu tion, and has made an order under rule (1) confirming the sale, and an appeal from disallowance has been dismissed by the High Court, the three years ' period provided by the Indian Limitation Act, 1908, Schedule I, article 180, for an application under Order XXI, rule 95. by the purchaser for delivery of possession runs from the date of the order on appeal; the High Court having under the Code of Civil Proce dure, 1908, the same powers as the Subordinate Judge, the 'time when the sale becomes absolute ', for the purpose of article 180 is when the High Court disposes of the appeal." Under article 180 of the Indian Limitation Act, the period of limitation runs "from the date when the sale becomes absolute. " If we give a narrow and literal meaning to these words, the period of limitation should be held to run from the date when the original Court of execution confirms the sale. But, as was pointed out by the Privy Council, the High Court as an appellate Court had the same powers as the trial Court and it is only when the appeal was dismissed by the High Court that the order of the trial Court confirming the sale became absolute. Till the deci sion of the appellate Court, no finality was attached to the order confirming the sale. (1) I.L.R. 61 Cal. g45. 817 It is clear that in this case the same rule would apply to the order recording satisfaction of the decree and to the order confirming the sale. If the order recording satisfac tion of the decree was not final and remained an inchoate order until the appeal was decided, the order confirming the sale would have the same inchoate character. This position seems to have been fully conceded in the statement of their case filed on behalf of the respondents in this Court. It is quite clear that in this case the learned Judges of the High Court have taken up an inconsistent position. As I have already stated, they have held, for the purpose of allowing one of the appeals, that the judgment debtors were not hit by clause (D)of the proviso to section 3 of the Act because they ceased to be the owners of Tedlain village at the date of the sale in 1935. If this conclusion is cor rect, it must follow as a matter of logic that the decree was completely satisfied on the date of the sale, because the sale fetched a larger amount than what was payable under the decree and the excess amount was deposited by the de cree holder in Court. The sale and satisfaction must go together and if finality is to be attached to the sale it should have been held to attach also to the order recording satisfaction of the decree. It seems clear to me that if the decree had ceased to exist, no relief could be claimed by the judgment debtors under the Madras Act. On the other hand, if the appeal had to be decided on the footing that the order recording satisfaction of the decree was not final, the same approach should have been made in regard to the effect of the sale. It is also clear that if the decree was satisfied on the date of sale by the application of the provisions of the Act, the sale could not stand, because how could the property be sold in execution of a decree which had been already satisfied. Yet, notwithstanding the fact that nothing was due under the decree, the High Court has held that the sale was a good sale and was to stand. The correct approach to the case would have been to assume for the purpose of the appeals that neither of the orders passed by the 818 Subordinate Judge was final. On that view, the appeals to the High Court could not have been decided on the footing that the judgment debtors had ceased to be the owners of Tedlain property and were therefore not hit by clause (D) of the proviso to section 3 of the Madras Act. In my opinion, the judgment of the High Court cannot be sustained, and the appeal s will have to be allowed. I will now deal very briefly with two preliminary objec tions raised on behalf of the respondents. The first objec tion is that the application for leave to appeal to his Majesty in Council against the order of the High Court was barred by limitation, inasmuch as the reasons stated in the affidavit filed by the appellant in the High Court in sup port of his application for excusing delay do not consti tute sufficient reason within the meaning of section 5 of the Limitation Act. The answer to this objection will be found in the facts which have been already narrated. The delay was caused mainly by reason of the review of the order of the High Court and the High Court considered that there as sufficient reason for condoning the delay. This Court cannot override the discretion exercised by the High Court and the matter cannot be reopened in these appeals. The second objection is based on the fact that the decree holder was given a choice by the High Court to elect wheth er he would deposit the purchase money or have the sale set aside, and his counsel told the learned Judges on the 15th November, 1946 that his client wished to retain the property which he had purchased and pay the purchase money in cash. It is contended that in view of this statement it was not open to the appellant to contend that he need not pay any amount to the judgment debtors. This objection also is entirely devoid of any substance,because there is nothing on record to show that the appellant has consented to be bound by the order of the High Court and waived his right to appeal against it by reason of the election. The learned counsel for the respondents also contended that the sale should have been set aside by the 819 High Court because the permission given to the decreeholder on the 16th February, 1934, to bid and set off the decretal amount against the purchase price was confined to an earlier sale and did not extend to the sate which took place on the 16th March, 1935, after the upset price which had been originally fixed was reduced. Personally, I am inclined to hold that the permission covered the sale in question, but in any case it is difficult to hold on the facts stated that there was any such material irregularity as would vitiate the sale. The precise argument which is put forward here was advanced in the Courts below but it did not find favour either with the Subordinate Judge or with the High Court. Besides, the respondents cannot raise the point in these appeals because they have filed no appeal against the order of the High Court upholding the sale. In these circumstances, I would allow the appeals, set aside the orders of the High Court and restore the order of the learned Subordinate Judge. There will however be no order as to costs in these appeals. MUKHERJEA J. I concur in the judgment just now deliv ered by ray learned brother, Fazl Ali J., and there is nothing further which I can usefully add. CHANDRASEKHARA AIYAR J. The facts which have cha given rise to these appeals and the questions for decision have been stated in the judgment just now pronounced by my learned brother Fazl Ali J. I wish to add only a few words on the main contention advanced for the respondents by their learned Advocate, Mr. V. Rangachari. If by reason of the confirmation of sale and satisfac tion of the decree having been entered up, the title to the village had passed indefeasibly to the decreeholder, there was no longer any decree or decree debt to be scaled down. If, however, the title did not pass, because it was still open to the respondents to attack the Court sale under Order XXI, rule 90, they were landholders of the village and, as such, they would 820 come within the scope of proviso (D) to section 3 of the Madras Agriculturists ' Relief Act, 1938, which enacts that a landholder who holds a village paying more than Rs. 100 as quit rent or jodi is not an agriculturist within the meaning of the Act. The apparent inconsistency in the view taken by the High Court was recognised, if not conceded, by the learned coun sel. In one view, there ,,as no longer any decree in respect of which the Agriculturists ' Relief Act could operate; and in the other view, the respondents could not take advantage of the Act, as their ownership of the village precluded them. Faced with this dilemma, Mr. Rangachari urged a some what ingenious argument. He contended that though the. title passed to the decree holder on the confirmation of sale and became vested in him from the date of the sale, the respo dents could still be regarded as having an interest in the village, as the sale was open or liable to challenge and the title 'of the decree holder was inchoate or incomplete. There is, however, really no support for this position. On confir mation, the title of the decree holder became absolute or complete. If the sale was set aside, the title would revest in the judgment debtor. There is nothing like an equitable title in the decree holder which could be recognised for certain purposes and not recognised for others. Under the Madras Act, "agriculturist" means "a person who has a saleable interest in any agricultural or horticul tural land or one who holds interest in such land under a landholder as a tenant, ryot or undertenure holder." Section 10, sub clause (i) of the Act provides that the right conferred on an agriculturist to have a debt scaled down will not apply to any person who, though an "agriculturist" as defined in the Act, did not on 1 10 1937 hold an interest in or a lease or sub lease of any land. After the sale in 1935, the only interest which the judgment debtors had in the village was to have the sale set aside, under the rele vant provisions of the Civil Procedure Code. This interest is not the interest contemplated by section 3, sub clause (ii) (a) & (b) of the Act which speaks of a 821 saleable interest or interest as a tenant, ryot or underten ure holder. I agree in the conclusion reached by my learned broth er. Appeals allowed.

In execution of a decree obtained on a mortgage a vil lage owned by the mortgagor which was included in the mort gage was sold by the court on the 6th July 1935 and it was purhased by the mortgagee. An application by the mortgagor under 0 .XXI,.r. 90, C.P.C., for setting aside the sale for irregulrities was dismissed, the sale was confirmed and full satisifiction of the decree was recorded, on the 6th March 1943. A few days afterwards the mortgagor and his adopted son made an application under section 19 of the Madras Agricul turists ' Relief Act, 1938, praying for relief under the Act, and, as this application also was dismissed they preferred two appeals, one from the order dismissing this application and the other against the order of 6th March 1943 refusing to set aside the sale. The High Court of Madras held that, as the mortgagor 's village had been sold he did not come within the purview of el. (i)) of the proviso to 6. 3 of the Madras Agriculturists ' Relief Act and so he was entitled to claim relief under the Act and the debt stood discharged under the provision of the Act, but the Bale was not liable to be set aside; and in accordance with this judgment the decree holder was directed to pay the amount for which the property had been sold with interest thereon: ' Held per FAZL ALl and MUKHERJEA JJ. (i)that the conclu sions arrived at by the High Court were self contradictory because if the sale was effective on the date it was held or confirmed, the decree was also satisfied on that date and the judgementdebtors were no longer entitled to invoke the provisions of the Act; (ii) that the High Court was not justified in law in deciding the appeal on the footing that the judgment debtors ceased to be owners of the village from the date of sale and on that account were not hit by cl. (D) of the proviso to section 3 of the Act inasmuch as when an appeal is preferred from an order rejecting an application under O.XXI, r. 90, C.P.C., to set aside an execution sale, the sale does not become absolute until the matter is finally decided by the appellate court. 807 Per CHANDRASEKHARA AIYAR J. After the execution sale in 1935 the only interest which the judgment debtors had in the village was to have the sale set aside under the relevant provisions of the Civil Procedure Code and this interest, not being an interest contemplated by section 3 (ii) (a) & (b) and section 19 (1) of the Act, they were not "agriculturists" and were not entitled to any relief under the Act. Held also, per FAlL ALl and MUKHERJEA JJ. A person does not cease to be a land holder of an estate within the mean ing of cl. (D) to the proviso to section 3 of the Act merely because the estate is placed in the hands of a receiver. Bhawani Kunwar vs Mathura Prasad Singh (I.L.R. 40 Cal. 89) and Chandramani Shaha vs Anarjan Bibi (I.L.R. 61 Cal. 945) referred Judgment of the Madras High Court reversed.

Appeal No. 134 of 1951. Appeal from the Judgment and Order dated 20th November, 1950, of the Labour Appellate Tribunal, Lucknow, in Appeal No. 10 of 1950. Bakshi Tek Chand and Veda Vyasa (section B. Kapur, with them) for the appellants. Shaukat Hussain for the respondent. Bishen Singh for the intervener. December 17. The Judgment of the Court was delivered by DAS J. This appeal has been filed with the special leave granted by this Court on May 10, 1951. By the order granting such leave the appeal has been restricted to one point only, namely, " whether the Government of Uttar Pradesh had the power to extend the time for making the award ex post facto, i.e. after the time limit originally fixed therefore had expired. There is no dispute as to the facts. An industrial dispute having arisen between the appellant company and its employees, by Labour Department Notification No. 637 (ST)/XVIII 53 (ST)/50 dated February 18, 1950, the Governor of Uttar Pradesh was pleased, in exercise of the powers conferred by section 3 read with section 4 of the U. P. (U. P. Act No. XXVIII of 1947), to refer the said dispute to the Labour Commissioner. U. P., or a Conciliation Officer of the State Government nominated by him for adjudication on seven several issues specified therein and to direct the adjudicator to conclude the adjudication proceedings and submit his award to the Government not later than April 5, 1950. The Labour Commissioner by his letter No. I.M.R. 14 A nominated Shri M. P. Vidyarthi, Regional Conciliation Officer, U. P., as the adjudicator in the above dispute with a direction that be should submit his, award by March 25, 1950, and that if the proceeding, were not likely to be 441 completed within that time he should move the Government for extension of time at least a week before the specified date. By Notification No. 897 (ST)/XVIII 53 (ST)/50 dated March 20, 1950, the Governor was pleased to order that the adjudicator should also adjudicate on an additional issue formulated therein. By a further Notification No. 950 ' (ST)/XVIII 53 (ST)/60 dated March 24, 1950, the ,Governor was pleased to refer another additional issue for the decision of the adjudicator. The adjudicator did not make his award on or before April 55 1950, as directed by the first order of reference but made his award on April 13, 1950, that is to say, 8 days after the expiry of the time originally fixed for the making of the award. About thirteen days after. the I delivery of the award Labour Department Notification No. 1247 (ST)/XVIII 53 (ST)/50 was issued on April 26, 1950, whereby the Governor was pleased, in exercise of powers conferred by section 3 read with section 4 of the 'Act, to allow the adjudicator in the said dispute to submit his award by April 30, 1950. Thereafter by Notification No. 1447 (ST)/XVIII 53(ST)/50 dated August 1, 1950. , the Governor was pleased, in exercise of powers conferred by section 6 (2) read with sections 3 and 4 of the Act, to order that the award be enforced for a period of six months from the date of that order in the first instance and thereafter for such further period as might be prescribed. On August 17, 1950, the appellant company preferred an appeal against the award to the Labour Appellate Tribunal contending, inter alia, as follows: That the award dated April 13, 1950, is vitiated, having been given after the expiry of the time limit. (a) In its order dated February 18, 1950, para. (5), Government directed the adjudicator to conclude the proceedings and submit his award not later than the 5th April, 1950. The award is dated 13th April, 1950. The Government, however, tried to remedy 442 this defect by the issue of G.O. No. 1247 (ST) XVIII 53 (ST)/50 dated April 26, 1950, but under the law this is of no avail. To be a valid extension of date granted to the adjudicator, Government ,.,order should have been issued before the 5th April, 1950, to keep the authority of the adjudicator alive. "On the date the adjudicator made the award, i.e., 13th April, 1950, he had no power to make an award. " The Appellate Tribunal by its decision given on November 20, 1950, dismissed the appeal with the following observations on the point mentioned above. " With regard to the last point our view is that as the Government had the authority under section 6 of the Act to fix time limit for submitting an award it had also the necessary and incidental power to extend the time limit originally fixed, if it considered it necessary. The first proviso to section 3 empowers the Provincial Government to add more matters for adjudication. It is obvious that additions to the matters already referred to would or may take more time than what had been originally estimated, and so ,it may lead to an impossible position if the Government had no power to extend the time originally fixed by it, and it makes no difference, in our opinion, whether the time is extended before or after the expiry of the time originally limited. " The present appeal is against that decision of the Appellate Tribunal but limited to the question hareinbefore mentioned. Dr. Tek Chand appearing in support of this appeal urges that the adjudicator derived his authority under the order made by Notification No. 637, dated February 18, 1950. Section 6 (1) provides that the adjudicator " shall, within such time as may be specified, submit its award to the State Government. " The time specified by the order was " not later than April 5, 1950. " On the expiry of that time the adjudicator became functus officio and bad no power or authority to make the award. It is true that two 448 more issues were, by the two subsequent orders, added to the list of issues to be determined by the adjudicator but those issues, Dr. Tek Chand submits, did not involve any detailed investigation into facts necessitating any further time for making the award. Learned counsel contends that the U.P. Act under consideration has no provision empowering the State Government to enlarge the time for the making of ' the award by the adjudicator. 'In the circumstances, if the State Government took the view that the addition of those two issues would render the time ' specified in the original order inadequate for the purpose it should have cancelled the previous notification and issued a fresh notification referring all the issues to the adjudicator and specifying a fresh period of time within which he was to make his award. ' The State Government did not adopt that course. What it purported to do was to extend the time for making the award not only after the time originally fixed had expired but also after the award had, actually been submitted. The argument is that even assuming but not admitting that the State Government had the power to extend the time before the time had expired it certainly had no power to do so after the award had been made, for it was meaningless, urges Dr. Tek Chand, to extend the time to do an act which bad already been done. He refers us to the decision of the Judicial Committee in Baja Har Narain Singh vs Chaudhrain Bhagwant Kuar(1) where it was held that under the Code of Civil Procedure of 1882 the Court had no power to extend the time for making the award after the award had been filed. Section 514 of that Code enabled the Court to grant a further time and from time to time to enlarge the period for the delivery of the award but section 521 provided that no award shall be valid unless made within the period allowed by the Court. Their Lordships of the Privy Council took the view that it would not have been competent for the Court to extend the time after the award had been made, for once the award was made (1) L.R. 18 I.A. 55; 13 All. 300 444 and delivered the power of the Court under section 514 was spent and that although the Court had the fullest power to enlarge the time under that section as long as the award was not completed it no longer possessed any such power when once the award was made. in order to give full effect to section 521 the Judicial Committee had to confine the exercise of the power to extend the time given to the Court by section 514 to a point of time before the award had been made. This decision was relied upon by Mr. Justice Harring ton sitting singly on the Original Side of the Calcutta High Court in Shib Krishna Dawn & Co. vs Satish Chander Dutt(1) which was a case governed by the Code of 1908. The learned Judge overlooked the fact that paragraph 8 of the Second Schedule to the Code of 1908 which corresponded to section 514 of the Code of 1882 expressly conferred power on the Court to allow further time and from time to time, either before or after the expiration of the period fixed for the making of the award, to enlarge such period and that paragraph 15 which corresponded to section 521 of the Code of 1882 contained no provision that an award made out of time was ipso facto invalid and that consequently the reasoning underlying the decision of the Judicial Committee in the case of Raja Narain Singh vs Chaudhrain Bhagwant Kuar (2) had no application to the case before him, which was governed by the Code of 1908. Having regard to the difference in the language of the relevant provisions of the two Codes, the correctness of the decision of Harrington J. was doubted by Mr. Justice Chitty also sitting singly on the Original Side of the Calcutta High Court in Sri Lal vs Arjun Das(3). Eventually the, decision of Mr. Justice Harrington was dissented from by a Division Bench of the same High Court sitting in appeal from the Original Side in Jetha Lal Laxmi Chand Shah vs Amrita Lal Ojha(4), which held that the Court had power to enlarge the time for making the award even after the award had (1) I.L.R.38 Cal. (3) (2) 18 I.A. 55. (4) I.L R. ;42 C.W.N. 833. 445 actually been made. The learned Judges in the last mentioned case referred to and relied on the case of Lord vs Lee(1). Reference has also been made by learned counsel for the respondents to Dentron vs Strong (2) and toMay vs Harcourt (3). It will be noticed that all those English cases were decided under section 15 of the Common Law Procedure Act, 1854 (17 & 18 Vic , c. 125). It is true that in that English statute there was no provision similar to section 521 of our Code of 1882 which was noticed by the Privy Council in the case cited by Dr. Tek Chand; nevertheless section 15 of the English statute like section 514 of the Code of Civil Procedure of 1882 corresponding to paragraph 8 of the Second Schedule to the Civil Procedure Code of 1908 and like section 9 of the English Arbitration Act, 1889, corresponding to section 12 of the Indian Arbitration Act, 1899, empowered the Court, from time to time, to enlarge the time for making the award. There is a similar provision for enlargement of time in section 148 of our Civil Procedure Code of 1908. There is, however, no similar provision in the U. P. Section 6(1) of that Act peremptorily requires the adjudicator to submit his award to the State Government " within such time as may be specified " and not "within such time as may from time to time be specified. " It is significant that the only occasion when the State Government can, under the U. P. Act, specify a fresh period of time is when it remits the award for reconsideration under sub section (2) of section 6, for under subsection (3) the adjudicator is enjoined to submit his award, after reconsideration, within such period as may be specified by the State Government. Even in this case, under section 6(2) and (3) the State Government may in the order remitting the award specify a time within which the award, after reconsideration, must be filed. This gives power to the State Government to fix a fresh period of time to do a fresh (1) (2) (1874) L. R. 9 Q.B. 11 7, (3) I.P.R. 13 Q. B.D. 688, 446 act, namely, to reconsider and file the reconsidered award. It does not give the State Government any power to enlarge the time fixed originally for the initial making of the award. Therefore, except where ,the State Government under section 6 (2)remits the 'award for reconsideration it has no power even to specify a fresh period of time and much less a power to extend the time for the initial making of the award under section 6 (1). In exercise of the powers conferred by clauses (b), (c), (d) and (g) of section 3 and section 8 of the U. P. , the Governor was pleased to make an order embodied in Notification No. 615 (LL)/XVIII 7 (LL) 1951, dated March 15, 1951. The proviso to rule 16 of that order authorised the State Government to extend from time to time the period within which the Tribunal or the adjudicator was to pronounce the decision. These rules were, however, not in force at the time material to the case before us. Learned counsel appearing for the respondent and for the State of Uttar Pradesh have not referred us to any similar rule which, was in force in 1950. In view of the language of section 6 of the U. P. Act and in the absence of a rule like the proviso to rule 16 referred to above it must follow that the State Government had no authority whatever to extend the time and the adjudicator became functus officio on the expiry of the time specified in the original order of reference and, therefore, the award which had not been made within that time must be held to be without jurisdiction and a nullity as contended by Dr. Tek Chand. Learned counsel for the respondents refers us to the provisions of section 14 of the U. P. General Clauses Act, 1904, which provides that where by any Uttar Pradesh Act any power is conferred on the State Government then that power may be exercised from time to time as occasion requires. Sections 3 and 4 of the U. P. , certainly confer power on the State Government to refer disputes to an adjudicator for decision 447 and section 6 (1) may be read as empowering the State Government to specify the time within which the adjudicator to whom an industrial dispute is referred for adjudication is to submit his award. The combined effect of section 14 of the U. P. General Clauses Act and section 6(1) of the U. P. , it is contended, is that the adjudicator is enjoined to submit his report "within such time as may from time to time be specified " and that this being the position, the principles laid down in the English decisions referred to above must be held to be applicable to the present case. We are unable to accept this line of reasoning. Under section 14 of the U. P. General Clauses Act the State Government may exercise the power conferred on it by sections 3, 4 and 6, that is to say, it can from time to time make orders referring disputes to an adjudicator and, whenever such an order of reference is made, to specify the time within which the award is to be made. This power to specify the time does not and indeed cannot include a power to extend the time already specified in an earlier order. The legislative practice, as evidenced by the provisions of the different statutes referred to above, is to expressly confer the power of extension of time, if and when the legislature thinks fit to do so. There is no question of any inherent power of the Court and much less of the Executive Government in this behalf. Section 14 of the U. P. General Clauses Act does not in terms, or by necessary implication, give any such power of extension of time to the State Government and, therefore, the Respondents can derive no support from that section. Learned advocate for the Intervener, the State of Uttar Pradesh, draws our attention to section 21 of the U. P. General Clauses Act, 1904, and contends that the order of April 26, 1950, should be taken as an amendment or modification, within the meaning of that section, of the first order of February 18, 1950. It is true that the order of April 26, 1950, does ex facie purport to rectify, the order of 448 February 18, 1950, but, in view of the absence of any distinct provision in section 21 that the power of amendment and modification conferred on the Government may be so exercised as to have retrospective operation the order of April 26, 1950, viewed merely as an order of amendment or modification, cannot, by virtue of section 21, have that effect. If, therefore, the amending order operates prospectively, i.e., only as from the date of the order, it cannot validate the award which bad been made after the expiry of the time specified in the original order and before the date, of the amending order, during which period the adjudicator was functus officio and had no jurisdiction to act at all. We do not think the respondents can derive any support from section 21 of the U. P. General Clauses Act. The result, therefore is that this appeal must be allowed and the award must be declared to be null .and void and we order accordingly. In the circumstances of this case we make no order as to costs. Appeal allowed. Agent for the intervener: C. P. Lal.

On February 18,1950, the Governor of Uttar Pradesh referred an industrial dispute to the Labour Commissioner or a person nominated by him with the direction that the award should be submitted not later than April 5, 1950. The award, however, was made on April 13, and on April 26, the Governor issued a notification extending the time for making the award up to April 30: Held, (i) in view of the language of section 6 of the U. P. , and in the absence of a provision like that contained in the proviso to r. 16 of the Governor 's notification dated in March 15, 1951, the State Government had no authority whatever to extend the time, and the adjudicator became functus officio on the expiry of the time fixed in the original order of reference and the award was therefore one made without jurisdiction and a nullity. (ii)Section 14 of the U. P. General Clauses Act, 1904, did not in terms or by necessary implication give any such power of extension of time to the State Government. (iii)Though the order of April 26 did exfacie purport to modify the order of February 18, in view of the absence of any distinct provision in section 21 of the U. P. General Clauses Act, 1904, that the power of amendment and modification conferred on the State Government may be so exercised as to have retrospective operation, the order of April 26, viewed merely as an order of amendment or modification, cannot, by virtue of section 21, have retrospective effect. Raja Har Narain Singh vs Chaudhrain Bhagwant Kuar (L.R. 18 I.A. 55) applied. Jetha Lal Lakshmi Chand Shah vs Amrita Lal Ojha (I.L.R. , Lord vs Lee (L.R. 3 Q.B. 404), Dentron vs Strong (L.R. 9 Q.B. 117), May vs Harcourt (L.R. 13 Q.B.D, 688) distinguished. 57 440

No. 1 of 1960. Under article 32 of the Constitution of India for the enforcement of Fundamental Rights. A. V. Viswanatha Sastri, 'K.K. Jain and Ganpat Raj, for the Petitioners. C. K.Daphtary, Solicitor General of India, V.A. Saiyed Mohamad and T. M. Sen, for the Respondents. August 8. The Judgment of the Court was delivered by SHAH, J. Controls on exports and imports imposed as an emergency measure during the last war in respect of certain commodities were kept alive after the lapse of the Defence of India Rules by the Emergency Provisions (Continuance) Ordinance, 1946 which was later replaced by the Imports and Exports (Control) Act,. 1947 ( 18 of 1947), by s.(3) of the Act, the Central Government was authorised by order published in the Official Gazette, to provide for prohibiting, restricting or otherwise controlling, in all cases or in specified classes of cases, and subject to such exceptions if any, as may be made by or under the order, inter alia the import, export, carriage xxx xxx of goods of any specified description. By sub sec(2) of s.3. , it was provided that all goods to which an order under sub s.(1) applied shall be deemed to be goods of which the import or export has been prohibited or restricted under s.19 of the Sea Customs Act. Exercising authority under s.3 of the Imports and Exports (Control) Act, 1947, the Central Government issued notifications from time to time prohibiting, restricting or otherwise controlling the export and import of diverse commodities. By a consolidated order dated 75 December 7, 1955, known as the Imports (Control) Order, 1955, restrictions on the import of certain goods were imposed by el. 3 of the said order. By el. 3, it was provided that save as otherwise, provided in the order, no person shall import any goods of the description specified in Schedule I, except under, and in accordance with, a licence or a customs clearance permit granted by the Central Government, or by an officer specified in Schedule II. For implementing the scheme of controlling imports, diverse provisions were made in cls. 3 to 11 of the Imports (Control) Order. The Government of India makes known its import policy every six months by issuing in the Government Gazette the procedure and the conditions for eligibility of licences and for the grant of import licences. This policy is published for the use of the public in a hand book called the "Import Trade Control Policy". The policy is obviously framed having regard to requirements for home consumption of commo dities to be imported, the foreign currency situation and the economy of the country as a whole. By para 51 of the Import Trade Control Policy for the licensing period October 1958 to March 1959, a scheme of "Export Promotion" permitting imports depending upon the value of specified varieties of goods exported by the impro per was devised. It was recited in that paragraph that in certain items, the inter relation between imports and exports was direct and intimate and the ability to export some manufactured goods depended largely on the facility with which the exporter or the manufacturer could procure the basic raw materials required in the manufacture. With a view to promoting the export of such goods, a scheme was therefore devised for the grant of special import licences to 76 replace the imported raw material component of the product exported or to provide an incentive for larger exports. Artsilk yarn and artsilk fabrics were covered by the Export Promotion Scheme. In Appendix 42, cl.2 of the Import Trade Control Policy. for October 1958 to March 1959, it was stated: "With a view to stimulate exports of Indian artsilk fabrics, sarees, garments, hosiery and other artsilk manufactures, it has been decided to grant import licences at the ports under the Export Promotion Scheme for the import of permissible varieties of artsilk yarn to actual exporters upto the following percentage of the rupee equivalent of foreign exchange earned on the basis of the f. o. b. value of The artsilk goods exported, or the value assessed by customs, whichever is less. (i) 66 2/3 per cent in the case of Indian artsilk sarees, (ii) 100 per cent in the case of other Indian artsilk fabrics including Indian artsilk hosiery goods. " The petitioners, M/s. Ram Chand Jagadish Chand are a firm engaged in. business as exporters and importers. In the period October 1958 to March 1959, the petitioners exported to Singapore, Bush Shirt Cloth, Glass Nylon, Art silk Piece Goods and Superior Class Nylon of the total C.I.F. value of Rs. 7,10,817/ , and relying upon cl. (2) of the Export Promotion Scheme as outlined in the Import Trade Control Policy, called upon the Controller of Imports to issue licences for artsilk yarn for Rs. 4,04,218.62 np. and Rs. 3,03,490.93 np. respectively for the months of February and 77 March 1959. The petitioners claimed that they had, pursuant to the Export Promotion Scheme, exported artsilk goods to Singapore and had earned net foreign exchange of the value of Rs. 7,07,709.55 np. and that they were entitled to import licences for artsilk yarn of that amount. In September 1959, the petitioners were informed by the Assistant Controller of Imports and Exports that a consolidated licence for the months of February and March, 1959 was granted to them for import of artsilk goods of the value of Rs. 3,19,354/ . It appears that the Government of India, having come to learn of certain malpractice by the importers of artsilk yarn, while suspending the Export Promotion Scheme as from March 9, 1959, announced that applications which were pending with the port licensing authorities will be scrutinised by a Committee and in May 1959, the Government of India appointed a Committee for verification of the value of good exported. The petitioners appeared before the Committee and furnished documentary evidence in support of their claim for 100% of the rupee equivalent of the cloth exported. The Committee accepted as reasonable the rates at which the exported " 'Flock Printed Nylon Dyed" cloth was exported by the petitioners, but in their view, the rates at which ",Bush Shirt Cloth" was exported could not be accepted as reasonable and for the purpose of the Export Promotion Scheme, the value of that cloth should be computed at the rate of Re. 1.50 np. per yard of 36" width. The Controller of licences accepted the recommendation of the Committee and issued to the petitioners an import licence for Rs. 3,19,354/ only. The petitioners after making, an in fructuous demand for a licence for the value of the goods exported, filed this petition under article 32 of the Constitution for a writ or direction in the nature of mandamus directing the Chief Controller of Imports and ,Exports to Avant to the petitioners an import. 78 licence for the months of February and March 1959 equivalent to 100% of the goods exported by them in relevant previous months and in the alternative, to issue a writ of certiorari calling for the records and proceedings resulting in the issue of a licence of the value of Rs. 3,19,354/ and for an order quashing the same and granting to the petitioners a licence for the full amount claimed by them. The petitioners submitted that the Controller of licences had arbitrarily reduced the value of their import licence under the Export Promotion Scheme and had thereby unlawfully infringed their fundamental right to carry on business. They also claimed that the Controller was bound to grant licence to import artsilk yarn under the Export Promotion Scheme for the full value of the goods exported by them, and in failing to do so, had practiced discrimination against the petitioners, because several other importers of artsilk yarn who were the petitioners ' rivals in trade during the identical period were given licences for amounts "ranging between 85 and 100 per cent of their exports". In paragraph 22 of their petition, the petitioners submitted a table setting out the names of eight such exporters, the amount and the percentages granted to such exporters. The fundamental right of a citizen to carry on any occupation, trade or business under article 19 (1)(g) of the Constitution is not absolute : it is subject to reasonable restrictions which may be imposed by the state in the interests of the general public. The right of the State to impose controls in the larger interest of the general public on imports has accordingly not been denied: nor has the authority of the 'State to issue the Imports (Control) Order, 1955 in exercise of the powers conferred by the Imports and Exports (Control) Act providing for imposition of restrictions by permitting import of certain goods only in accordance with,,licences or customs permits granted by the 79 Central Government,, been challenged. It was suggested. somewhat faintly by Mr. Viswanatha Sastri on behalf of the petitioners that the power granted under c 1. (3) of the Imports (Control) Order, 1955 was uncanalised power in the matter of fixing percentages and to that extent, the authority imposed an unreasonable restriction on the freedom to carry on business. But the authority to grant or refuse to grant licences is conferred upon high officers of the State and the grant of licences is governed by the Import Trade Control Policy which is issued from time to time and detailed provisions are made in the Imports (Control) Order getting 'out the grounds on which licences may be refused, amended, suspended or cancelled (see cls. 6 to 9 of the Order). Provision to afford a bearing to the licence before action is taken under cls. 6 to 9 is also made. It cannot therefore be said that the power conferred is uncanalised or arbitrary. The argument seriously canvassed by counsel for the petitioners was that relying upon cl. 2 of appendix 42 of the Import Trade Control Policy, the petitioners had exported artsilk fabrics, and had earned foreign currency, and they could not, except for good and adequate reasons, be deprived of import licence to the full extent of 100% of the value of the artsilk fabrics exported. The petitioners say that they purchased the goods from various merchants and by exporting those goods earned foreign exchange which was duly credited to their account by their bankers, and in reducing the import licence to approximately 45% of the value of the goods exported, the State has, by executive order, imposed an unreasonable restriction upon their right to carry on business. But under el. 2 of the Export Promotion Scheme as outlined in appendix 42 in so far as it related to licences for import of artsilk yarn, the Controller of Imports is authorised to grant licences upto the percentages specified in that clause : there is no right thereby 80 created to the exporter to obtain a licence for the full value of the commodity exported. Under el. 2 of the, scheme the Controller has the power to grant a licence for any amount upto 100% of the rupee equivalent of the foreign exchange earned on the basis of the F.O.B. value of the goods exported. By that clause, the exporter is not given the option to claim an import licence for any amount not exceeding the value of the foreign exchange earned by export of goods. The clause invests the Controller with authority, it does not impose an obligation upon him enforceable at the instance of the exporter, to issue a licence for the amount (subject to the maximum prescribed. claimed by the exporter. The power is plainly discretionary. It is true that the discretion has to be exercised reasonably and not arbitrarily. The, licensing authority would normally issue an import licence for 100% of the value of the goods exported, but having regard to special considerations such as difficult foreign exchange position or other matters which have a bearing on the general interest of the State, import licences for a smaller percentage may be granted to the exporters. But by the use of the expression "upto the following percentage of the rupee equivalent" power to fix arbitrarily a percentage of the value of the goods exported for awarding an import licence is not granted. In granting a licence to the petitioners for Rs. 3,19,354/ , has the authority been exercised arbitrarily or is it supported by some reasonbly discernible principle? Ram Murth Sharma, Deputy Chief Controller of Imports and Exports in his affidavit stated that of the Export Promotion Scheme wrongful advantage was taken by some exporters of artsilk fabrics : it was found by the Government of India that invoice values or artificial silk fabrics were inflated. by the exporters by more than 100% of the value with the object of exporting "speculative" commodities like artificial 81 silk yarn. , Sharma stated that ",as against 381 thousand yards of artificial silk fabrics exported during the period January June, 1957 at a value of about Rs. 456 thousand i.e., at about Rs.2 0 L. per yard the merchants sought to show the rise in price for the export of such goods during October March 1959 at Rs. 2 9 0 per yard so that for 986 thousand yards exported, the invoice value shown was 28,799 thousand rupees, even though the actual price of the goods in the wholesale market had not at all risen to that extent between those two periods. The index number of wholesale price in India in respect of "silk and rayon" fabrics during the month of June 1957 was 85 and during the month of March 1959 it rose to 95.7 only thus showing a rise of about 11%. Against this rise, the rise in the price invoiced by the exporters showed a rise of over 125% during the span of the same period. This will clearly show that the aforesaid rise was shown by merchants merely with a view to get licences for higher value for the import of speculative item like "Art Silk Yarn. " Relying upon this evidence, counsel for the Union contended that this perversion of the Export Promotion Scheme had serious repercussions on the foreign exchange position, and the scheme was suspended by notification dated March 6, 195 , and government directed that the pending applications for import licences for artsilk yarn be scrutinised by a Committee appointed in that behalf. The Committee scrutinised the cases of 1106 parties including the petitioners, and the petitioners were given a, licence for Rs. 3,19,354/ , and by reducing the value of ' the import licence, no fundamental right of the petitioners under article 19 of the Constitution was infringed. A scrutiny of the applications for licences in view of the misuse of. the Export Promotion Scheme and granting of licences on the result of such scrutiny cannot be regarded as imposing an 82 unreasonable restriction. The State is as much concerned with earning foreign exchange as maintaining and consolidating its export trade. if a large quantity of goods be dumped at excessive prices foreign markets to meet a temporary demand in the ultimate result the export trade of the State may suffer. If taking advantage of temporary demands in the foreign market, the exporters charge excessive prices which axe not commensurate with reasonable profits on the real value of the goods and seek to invest the profits earned, in speculative commodities thereby endangering the internal economy of the country, the State may be justified in taking steps to prevent the exporters from obtaining advantage of such excessive profits by refusing to afford facilities for importing goods to the exporters who seek to rely upon the export Value of the goods at inflated rates. , The affidavit of Sharma shows that in a number of cases,, the importing firm in the foreign country was only a " 'sister concerns of the exporting house, and the exporters adopted the expedient of inflating the price with the object of adjusting the excess value received by them. It appears therefore that some exporters under cover of the Export Promotion Scheme by inflating the prices were found not only to import speculative varieties of goods for very much larger values than the real prices justified, but were suspected by the authorities even to repatriate foreign assets without disclosing the same to the State as required by law. It cannot therefore be said that the power granted to the licensing authorities to grant licences only upto the maximum spec ified in el. 2 of the Scheme is by itself an unreasonable restriction; nor will the notification directing scrutiny of all applications amount to imposing an unreasonable restriction. Counsel for the petitioners however submitted that the Controller had placed no evidence on the record that the petitioners have, for the goods 83 purchased by them in the Indian market, not paid M. 7,67,709.55 np. or that any part thereof represented foreign assets intended to be repatriated contrary to law. Counsel submitted that M/s. V. M. section Abdul Razak & Company to whom the goods were consigned are not a " 'Sister concern" of the petitioners and that in the affidavit of the Deputy Chief Controller of Imports and Exports it is not denied bat the petitioners bad received the full value for which the goods were exported by them. But in considering the case of the petitioners, the Committee observed : "The party has purchased Bush Shirt Cloth from J. C. Vakaria & Sons, Govardhandas Iswardass International Trading Agency, Agwarwla Brothers and Calcutta Silk Manufacturing Co., Ltd. Rates vary from Rs. 3.87 to Rs. 3.92. x x x x neither the purchase vouchers nor the export invoices contain any description nor give any idea as to whether the material was Nylon, Rayon, Nynon, etc. " The committee also observed that the petitioners were "not able to produce adequate justification of the prices of Art Silk Bush Shirting Cloth. Samples cannot be linked with the relative purchase vouchers or export invoices. " They then pointed out that the correspondence with M/s. Abdul Razak & Company did not give any "justification nor contained ' any description to link the goods with the materials sent," and in the light of these findings, the Committee recommended that. the value of bush shirt ' cloth for the purposes of import licence be calculated at the rate of Re. 1. 50 nP. per 'Yard. It is somewhat unfortunate that the Committed have not stated in the reasons given by them that Re. 1. 50 nP. was the prevailing: market rate in respect of Bush Shirt Cloth at the time of the export in the Indian market. But in paragraph 22 of the respondents ' affidavit, it is stated that "the petitioner firm has behalf granted licence equal to 84 100% of the value which has been arrived at as reasonable value of the exports effected by the firm. " The petitioners alleged that the decision of the Committee was arbitrary the licensing authority contends that the decision was made after ascertaining the reasonable value in the Indian market at the material time of the goods exported by the petitioners. The petitioners have not placed before the court any independent evidence to show that the current market rate of "bush shirt cloth" which was exported, substantially exceeded the rate of Re. 1. 50 nP. per yard of 36" width. In the circumstances, we would not be justified in assuming that the Committee made an arbitrary decision in arriving at the value of the bush shirt cloth exported for the purpose of recommending the grant of import licence. The contention that the order passed by the Controller granting a licence only for 45% of the value of the goods exported infringes the fundamental right of the petitioners under article 19 (1) (g) by imposing an unreasonable restriction cannot therefore be sustained. Does the fact that the petitioners have been granted licence approximately for 45% of the total value of the goods exported amount to discrimination entitling them to protection of article 14 of the Constitution ? Under the Export Promotion Scheme, the petitioners have exported artsilk goods of the value of Rs. 7,07,709.55.nP. and may in the normal course have been entitled to import licence for 100% of the value of the goods exported unless there was a reduction in the value of the licence for imports on account of certain circumstances such as general deterioration of the foreign exchange position or necessity to conserve a particular currency or other circumstances justifying a departure from the maxima set opt in cl. 2 of 85 appendix 42 of the Export Promotion Scheme. The reduction may also be justified on grounds personal to the petitioners or to a, group to which they belonged, Any malpractice or tinder hand dealing may warrant such a reduction. It was the case of the respondents that many exporters were guilty of malpractices and with a view either to speculate in artsilk goods or to repatriate unlawfully foreign assets, the value of the goods exported was unduly inflated. In the order passed by the Committee appointed by the Government of India, dealing with the case of the petitioners, it was observed that the petitioners had business relations with certain firms and that the rates at which bush shirt cloth were purchased varied from Rs. 3.87 to Rs. 3.92 nP. The Committee was not satisfied that the documentary evidence produced by the petitioners related to the goods exported by them. These findings disclosed that, in the view of the Committee, there was reason to believe that the claim of the petitioners that they had purchased goods approximately for the prices at which they were exported, was not made out. The Committee accordingly recommended that the value of "bush shirt cloth" should be computed at the rate of Rs. 1.50 nP. per yard. It is true that there is no definite evidence on the record indicating that was the current market rate, but the court may be justified in holding that the members of the Committee who were vitally concerned with the trade in artsilk goods were conversant with the current market rates of the cloth which was exported by the petitioners. Counsel for the Union has placed before us in the course of the hearing the report of the Committee in respect of seven out of the eight exporters who the petitioners claimed had been given import licence for the full value of the exports. The report of the Committee with regard to M/s. Rajasthan Exporters I and Importers, Calcutta 86 is not placed before us on the plea that. , it is not immediately available. On a perusal '.of the report of the Committee with regard to, the other exporters, it may be stated that the claim of the petitioners that Raghunath Rai Piyarilal were given import licence for the full value of the goods exported is not correct. It appears from the record that only 40% of 'the F.O.B. value was to be taken for "Glass, Nylon dved" exported in respect of application No. 36. Similar larly, in respect of application No. 35, 40% (if the F.O.B. value was to be taken for the purpose of granting import licences. It is true that in the cases of the other importers Premsukhdass Sitaram, Indian Exporters and Importers Corporation, M/s. Universal Watch Emporium, M/s. Jawahar Knitting Hosiery, M/s. Vastralaya Ltd. and M/s. Agarwala Trading Co., Ltd., the Committee have recommended acceptance of the purchase prices submitted by the exporters in granting import licences. It may, therefore, be assumed that these importers were, given licence for 1000% of the export value of the goods. But the Committee have given reasons which appear to be prima facie good for accepting the claims of these exporters ' If, on the materials placed before. them, the Committee were satisfied that there, was some misconduct or under hand dealing on the part of the petitioners, or that the evidence led before them justified the Committee in holding that the goods exported were not of the value ' claimed by the petitioners in their invoices, an order recommending that import licence may be granted for the value of bush shirt cloth computed on the basis of Re.1.50 nP. per yard does not. amount to discriminatory treatment of the petitioners. Article 14 confers a guarantee of the equal protection of the law a guarantee against arbitrary discrimination between persons similarly circumstanced. On the materials placed before the Committee. .there. evidence to show that the record produced by the 87 petitioners was unsatisfactory ; they were not satisfied that the prices which the petitioners said they had paid for purchasing the goods were in truth paid. If there was evidence to show that in respect of other persons who were in the opinion of the Committee found also to have inflated the prices 'in the manner adopted by :,the petitioners and still the Controller had granted import licences to those persons for the full amount of the. export value or a percentage substantially in excess of the percentage for which import licence was granted to the petitioners, a case of discrimin ation could have been made out ; but in the absence of such evidence, we do not think that any case of discrimination is made out. The petition fails and is dismissed with costs. The application filed by M/s. M. Shaams and Company for intervention is dismissed, because Miscellaneous Application No. 264 of 1960 which was filed by the applicants in the High Court of Judicature at Bombay for a writ of mandamus, direction or order under article 226 of the Constitution has been dismissed by the High Court and the remedy applicants is to file an appeal to. this Court. Petition dismissed.

Government of India published a 'scheme known as the "Export Promotion Scheme" according to which the value of import licence for raw materials in an industry depended upon the value of specified varieties of goods exported by the applicant for an import licence. It also empowered the Controller of Imports and Exports under cl. 2 'of Appendix 42 of the Import (Control) order 1955 to issue a license up to 66 2/3 per cent of the export value in the case of Indian artsilk sarees and up to 100 per cent in the case of other Indian artsilk fabrics. The appellant firm R of exporters and importers relying upon cl.2 of the Export Promotion Scheme applied for an import licence equivalent to the value of the goods it had exported and earned foreign exchange. In view of certain malpractices the Government of India suspended the "Export Promotion" scheme and set up a committee for verification of the values of goods exported. The Committee after scrutinising the firm 's claim found that rates of some of the items could not be accepted as reasonable, and recommended an import licence approximately of the value of 45 per cent of the goods exported. The firm R after making an infructuous demand for a licence for the full value of the goods exported filed a writ petition. They submitted that the Controller of Licences had arbitrarily reduced the value of their import licence and had thereby unlawfully infringed their fundamental right. They also claimed that the Controller was bound to grant licence under the Export Promotion Scheme for the full value of the goods exported by them and in failing to do so had practised discrimination 73 against them, because several other importers during the identical period were given licences for the full value of goods exported. Held, that the fundamental right of a citizen to carry on any occupation, trade or business under article 19(1)(g) of the Constitution is not absolute; it is subject to reasonable restrictions which may be imposed by the State in the interest of the general public. The right of the State to impose control in the larger interest of the general public on imports has accordingly not been denied; nor is the authority of the State to issue the Imports (Control) Order, 1955 in exercise of the powers conferred by the Imports and Exports (Control) Act providing for imposition of restrictions by permitting import of certain goods only in accordance with the licences or customs permits granted by the Central Government, open to challenge. The authority to grant or refuse to grant the licence is conferred upon high officers of the State and the grant of licence is governed by the Import Trade Control Policy and detailed provisions are made setting out the grounds on which licences may be refused, suspended or cancelled and provision to afford a hearing before action is taken is also made; thus the powers conferred under cl.3 of the Imports (Control) Order, 1955 are not uncanalised or arbitrary. The power granted to the licensing authority to grant licences only up to the maximum specified in cl.2 of the appendix 42 is by itself not an unreasonable restriction, nor will the notification directing scrutiny of all applications amount to imposing an unreasonable restriction. The clause invests the Controller with authority, it does not impose an obligation upon him enforceable at the instance of the exporter, to issue a licence for the amount (subject to the maximum prescribed) claimed by the exporter. The power is plainly discretionary and the orderd by the Controller granting a licence only for 45% of the goods exported does not infringe the fundamental right of the petitioner under article 19(1)(g) of the Constitution by imposing an unreasonable restriction. Held, further that in the absence of evidence to show that discriminatory treatment was made between the aggrieved person and to persons similarly circumstanced, there can be no violation of article 14 of the Constitution which confers a guarantee against arbitrary discrimination between persons similarly circumstanced . Held, also that where an application for writ of mandamus, direction or order under article 226 of the 74 Constitution is dismissed by the High Court, the only remedy to the aggrieved person is to come up by appeal and he has no right to be heard as an intervener.

Appeal No. 517 of 1960. Appeal from the Judgment and order dated November 20, 1958, of the Mysore High Court in Civil Writ Petition No. 234 of 1957. Porus A. Mehta, J. R. Gagrat and G. Gopalakrishnan, for the appellants. N. C. Chatterjee, G. Channappa, R. Gopalakrishnan and T. M. Sen, for the respondent. August 8. The Judgement of the Court was delivered by KAPUR, J. This is an appeal against the judgment and order of the High Court of Mysore dismissing the petition of the appellants made under article 226 of the Constitution. The appellants. were conducting since the month of August 1948, what were called "prize competitions" in the State of Mysore with the permission of the Government of the erstwhile State of Mysore. An Act called the Mysore Lotteries and Prize Competitions Control and Tax Act, 1951 (Act 27 of 1951), hereinafter called the "Mysore Act" was passed by the Mysore Legislature and came into force as from June 21, 1951. The Rules made thereunder came, into force on February 1, 1952. Previous to that the Bombay Legislature had passed a similar Act called the Bombay Lotteries and Prize Competitions Control and Tax Act, 1948, which was amended in November 1952. by the Bombay Act 30 of 1952. In December 1952 and January 1953 petitions under article 226 were filed in the High Court of Bombay challenging the Bombay Act. On January 12, 1955 233 the Bombay High Court held that the provisions of the Bombay Amendment Act above referred to were unconstitutional and that the taxes imposed under the provisions of that Act were hit by article 301 of the Constitution. The result of that judgment was that though prize competitions could be controlled by the States within their respective borders, their ramifications beyond those borders could only be dealt with by action under article 252(1) of the Constitution. It was for that reason that the States of Andhra, Bombay, Madras U. P., Hyderabad, Madhya, Bharat, Pepsu and Saurashtra passed resolutions under article 252(1) of the Constitution authorising Parliament to legislate for the control and regulation of prize competition% and in pursuance thereof Parliament passed the (Act 42 of 1955) hereinafter called the "Central Act" which Received the assent of the President on October 22, 1955, and came into force on April 1, 1956. On February 24, 1956, the Mysore Legislature passed a, resolution adopting the said Act. The resolutions passed by the various States and the resolution passed by the Mysore Legislature will be quoted in a later part of this judgment. On April 7, 1956, the appellants filed a petition under article 32 of the Constitution in the Supreme Court challenging the validity of the Central Act but that petition was dismissed and is reported as R.M.D.C. Chamarbaugwala vs The Union of India (1). The appeal against the Bombay judgment declaring the Bombay Act to be unconstitutional was brought in this court and, was allowed and that case is reported as State of Bombay vs R. M. D. Chamarbaugwala (2) . During the pendency of their petition under article 32 the appellants applied for and wore granted a stay of the operation of the Central Act pending the disposal of the said writ petition. This was on April; 16, 1956. The judgment of the Supreme Court in that petition was given. on April 9, 1957. On August 31, 1957, the (1) ; , 939. (2) ; , 929. 234 Mysore Lotteries & Prize Competitions Control and Tax (Amendment) Ordinance, 1957 (Ord. 6 of 1957) was issued by the Governor of Mysore and thus for the period of about 16 months the appellants carried on prize competitions as before. The Ordinance was enacted into an Act on September 28, 1957, which is Mysore Act 26 of 1957. Certain amendments were made by this in the Mysore Act as originally passed in 1951. As a result of this amendment the definition of prize competition was amended the definition as given in the Central Act was adopted and sections 8 & 9 of the Mysore Act. were omitted with retrospective effect from April 1, 1956; cl.(b) of sub section (1) of s.12 was amended and certain words referring to licences under s.8 were retrospectively omitted and retrospective effect was given to the Mysore Act as amended. By adding a proviso to s.15 of the Mysore Act all 'prize competitions conducted between March 31,1956, and August 31 1957, were brought within the purview of the amended Act. Thus the prize competitions which as a result of the stay of the operation of the Central Act were conducted by the appellants became subject to the operation of the Mysore Act as amended. The appellants on September 10, 1957, were called upon to file their returns but at their request for extension of time, they were given another 15 days in which to file their return. They filed their return but under protest. The gross collections were of a sum of Rs. 26,47,147 5 9 and on that the appellants were "called open to pay up provisionally" a sum of Rs. 3,30,893 7 0. As the money was not paid within the time specified proceedings were taken under section 6 (1) of the (Central Act 1 of 1890), and certain properties moveable and immoveable were attached 'and one of the properties was sold and the price so realised was deposited in the Government treasury. The Mysore amending Act was challenged in the High Court of Mysore by a petition under Art, 226 which was dismissed on November 20, 1958 235 and against that judgment and order this appeal has been brought pursuant to a certificate of the, High Court under article 132 (1) of the Constitution. The Certificate was confined to the interpretation of article 252 of the Constitution. The respondent in the present appeal is the State of Mysore. The challenge to the constitutionality of the Mysore Act was on the ground that (1) the Mysore Legislature by. adopting the Central Act was no longer competent to pass any law in regard to prize, competitions because the whole matter including the power of taxation was surrendered in favour of Parliament. (2) Even if the whole power had not been surrendered the impugned Act i.e. the, Mysore Act as amended violated Art.252(2) of the Constitution inasmuch as it indirectly amends the Central Act by adding a new method of control by imposition of penalties of a monetary nature. (3) The Mysore Legislature could not amend an Act which stood repealed as a result of the enactment of the Central Act. (4) The Mysore Act as amended was repugnant to the Central Act and is therefore, to the extent of repugnancy, void under article 254 (1) of the Constitution and (5) it was color able legislation in as much as the tax was imposed on the prize competitions with the object of controlling them. Certain other questions relating to the legality of the imposition of the tax and the proceedings for the recovery of the tax were also raised but on all these points the High Court found against the appellants The first question, raised before us is the effect of the; resolution passed by the, legislatures of the States above mentioned and of the resolution passed by the Mysore legislature adopting,the central Act. The resolution Passed by the States was in the following terms. "This Assembly do resolve that it is desirable that control and regulation of Prize 236 Puzzle competitions and all other matters consequential and incidental thereto insofar as these matters are matters with respect to which Parliament has no power to make laws for the States should be regulated by Parliament by law. " The two Houses of the Mysore Legislature passed the following resolution on February 23, 1956 *and February 21, 1956, respectively : Resolution passed by the Mysore Legislative Assembly on 23rd, February, 1956. "Whereas for the purpose of securing uniformity in legislation it is desirable that the control and regulation of Prize Compe titions and all other matters ancillary thereto should be regulated in the State of Mysore by the (Central Act 42 of 1955) passed by Parliament; Now, therefore, in pursuance of Clause, (1) of Article 252 of the Constitution, this Assembly resolves that the Act aforesaid be adopted by the State of Mysore. " It was contended that by these resolutions the legislatures of the various States had surrendered their power of legislation in regard to the "control and regulation of prize puzzle competitions and all other matters consequential and incidental thereto and had thus no legislative power left in regard to that matter including the power to tax. Article 252 provides article 252(1) "If it appears to the legislature of two or more, States, to be desirable that any of the matters with respect to which Parliament has no power to make laws for the States except as provided in articles 249 and 250 should be regulated in such States by Parliament by law, and if resolutions to that effect are passed by all the Houses of the legislatures of those States, it shall be lawful 237 for Parliament to pass an, Act for regulating that matter accordingly, and any Act so passed shall apply to such States and to any other State by which it is adopted afterwards by resolution passed in that behalf by the House or, where them are two Houses, by each of the Houses of the Legislature of that State. (2) Any Act so passed by Parliament maybe amended or repealed by an Act of Parliament passed or adopted in like manner but shall not, as respects any State to which it applies, be amended or repealed by an Act of the Legislature of that State. " The result of the passing of a, resolution under article 952(1) is that any matter with respect to which Parliament has no power to enact laws becomes a matter for the regulation of which Parliament becomes empowered to pass any Act, and such Act, if passed by the Parliament, becomes applicable to the States passing the resolution or adopting that Act. Sub clause (2) of that Article provides that any such Act may be amended or repealed by an Act of Parliament in the like manner i.e. in the manner provided in cl. (1) and it cannot be amended or repealed by the Legislature of the State or States passing the resolution. The question then arises do the resolutions as passed and particularly the words "control and regulation of prize puzzle competitions and all other matters ancillary thereto" surrender the whole subject of prize competitions to the Central Parliament i.e. every matter and power connected therewith including the power to tax. The argument raised was that the language of the resolutions was wide enough to comprise the legislative power under entries 34 and 62 of List II the former dealing with betting and gambling" and the latter with taxation of luxuries including "betting and gambling". One of the methods of control and regulations, it was submitted, is by 238 taxation and as the power ; to control, and regulate and all powers ancillary to the subject were surrendered the power to 'tax, being included therein was also surrendered. In support of this Argument reliance was placed on. certain judgments of the American Supreme Court. The first case relied upon was. Rudolph Helen V. United States (1). In that ease the question was about the jurisdiction of the United States District Court which, depended upon the nature . of the, imposition of an, additional duty i.e. whether it was penalty or ' not. The imposition, was held to be a penalty as it was not imposed for the purpose of revenue but was based upon the particular act of the importer i.e. his undervaluation of the goods imported ; in other words this additional sum was a penalty for undervaluation whether innocently done or not and whether it was called a further sum or an additional duty 'the amount imposed was not a duty upon imported article but a penalty and nothing else. The next case relied upon was J. W. Bailey vs Dexel Furniture Company (2). That was a case of colorable exercise, of legislative power. .Under the Child Labour Tax Law a tax of 10% of the net profits of the year could be imposed upon an employer and knowingly during any portion of the taxable period employed children within certain age limits irrespective of whether only one child was employed or several, This was held not to be a valid exercise by Congress of power of taxation but an unconstitutional regulation by the use of the tax as a penalty for the employment of child labour in the States which was exclusively a State function. That case was one in which the Congress exercised its. power of regulation by imposing a tax by way of penalty in,order to prevent the employment of child. labour and thus by If the exercise of the power which it possessed i.e. of (1) (1903)188 U.S.605: ; (2) (1922)259 U.S.33: ; 239 taxation it tried to regulate a subject over which it had no jurisdiction and that really was the matter which was decided by the American Supreme Court. The next case relied upon was Gloucester Perry Th (company vs Commonwealth of Pennsylvania (1). That was a case of interstate commerce and it was hold that no State could impose a tax on that portion of interstate commerce which is involved in the transportation of persons and property what ever be the instrumentality by which it is carried on. The tax there was levied upon receiving and landing of passengers and freight which was held to be a tax on transportation i.e., upon commerce. between the two States involved in such transportation. The following passage in the judgment of Field, J., at p. 162 was relied upon by counsel for the appellants "The Power to regulate that commerce, as well as commerce with foreign nations, vested in Congress is the power to prescribe the rules by which it shall be governed that is, the conditions upon which it shall be conducted ; to determine when it shall be free, and when subject to duties or other exactions. " But these observations were made in a different context, i.e., whether the tax could be levied upon transportation made in ferry boats which passed between States every hour of the day and as this transportation was within the commerce clause no tax could be levied by the States. Reference was next made to certain observations made in the State of Bombay vs R.M.D. chamarbaugwala (2) which was an appeal against the judgment of the. Bombay High Court. Das, C. J., observed at p. 926 "The fact that regulatory provisions have been enacted to control gambling by issuing (1) ; (2) ; , 929. 240 licences and by imposing taxes does not in any way alter the nature, of gambling which is inherently vicious and pernicious. " In that case no question as to the meaning of the word "control and regulation" arose nor whether those words included the power 'of taxation. All that the Court was called upon to decide was whether prize competitions were trade, commerce or business or were anti social activities. It was then argued that it was because of the decision by the Bombay High 'Court in State of Bombay vs R. M. D. Chamarbaugwala (1) whereby the tax imposed on prize competitions was struck down as contravening article 304(b), that the various States combined together and passed the resolution under article 252(1) of the Constitution. The object of the resolutions, it was submitted, was to get over the unconstitutionality pointed out by the Bombay High Court and therefore the resolutions were passed in the language used therein, i.e., for the control and regulation of prize competitions which power was transferred and surrendered to Parliament along with the powers incidental and ancillary thereto which must include taxation. It was further argued that as Parliament had failed to impose any tax it implied that it had refused to do so. In support of this argument reliance was placed on Sabine Robbins vs Taxing District of Shelby County, Tennessee (2). It was there held that where the power of the Legislature is exclusive its failure to make express regulation indicated its will that the subject shall be left free from any restriction or imposition. The pivot of the appellants ' argument is that the words "control and regulation" and , 'incidental and ancillary thereto" included power of taxation but this argument is not well founded. The power in regard to betting and gambling is contained in entry 34 of the State List which as follows . Entry 34: "Betting and gambling". (1) I. L. R. (2) ; 241 The power of taxation is contained in entry 62 which is as under Entry 62 : "Taxes on luxuries including taxes on entertainments. , amusements, betting and gambling. " In the Indian Constitution as it was in the Government of India Act the power of legislation is distributed between the Union and the States and the subjects on which the respective Legislatures can legislate are enumerated in the three 'Lists and in the Articles of the Constitution, provision is made as to what is to happen if there is a conflict between the Statutes passed by Parliament and the Legislatures of the States. The peculiar nature of the Indian Constitution in regard to the enumeration of powers in the entries in the Lists was emphasised by Gwyer, C. J., in re The Central Provinces & Berar Act No. XIV of 1938 (1) at p. 38 and by Sulaiman, J., at pp. 73 and 74. Gwyer, C.J., said: "But there are few subjects on which the decision of other Courts require to be treated with greater caution than that of federal and provincial powers, for in the last analysis the decision must depend upon the words of the Constitution which the Court is interpreting ; and since no two Constitutions are in identical terms, it is extremely unsafe to assume that a decision on one of them can be applied without qualification to another. This may be so even where the words or expressions used are the same in both cases ; for, a word or a phrase may take a colour from its context and bear different senses accordingly." (1) [1939] F.C.R.18,38,73,74. 242 At p. 74 Sulaiman, J., observed: "The heads have been separately specified in great detail ; and a special head " 'taxes on the sale. of goods" has been assigned to the Provinces, which did not at all find a separate and distinct place in the State or Provincial List of any of the Dominions. This peculiarity is a unique feature of the Indian Constitution, having an important bearing on the present case, as taxes on Bales have been adopted as a post war measure in most countries. " The entries in the Lists have to be read in accordance with the words employed and it will be wholly unjustified in forcing into them a meaning which they cannot reasonably bear. See Brophy vs Att. Gen. of Manitoba (1) Similar observations were made by Lord Wright, M. R. in James vs Commonwealth of Australia (2) and both these oases were quoted with approval in re The Central Provinces and Berar Act No. XIV of 1938 (3) by Sulaiman, J. Thus the subject of "betting and gambling" given in entry 34 of List II and the taxes on betting and gambling as given in entry 62 of List II have to be read separately as separate powers and therefore when control and regulation of prize competitions was surrendered to Parliament by the resolutions above quoted the power to tax under entry 62 of List II which is a separate head, cannot be said to have been surrendered. See the observations of Das, C. J., in State of Bombay vs R. M. D. Chamarbaugwala quoted a little later in this judgment. The scheme of the Indian Constitution and distribution of powers under it are entirely different from what it is in America and therefore the construction of the entries in the manner contended for by the appellants would be erroneous. It was then contended that a tax must be (1) , 215. (2) , 613. 243 levied for the purpose of revenue and cannot be for purpose of control and that in the Mysore Act was really colourable legislation in that the impugned tax had been levied for the purpose of controlling prize competitions although it was given the form of a tax. It may be remarked that the Court in construing and interpreting the Constitution or provisions of an enactment has to ascertain the meaning and intention of Parliament from the language used in the statute itself and it is not concerned with the motives of Parliament. To use the language of Gwyer, C.J., in re, The Central Provinces and Berar Act No XIV of 1938 (1) : "It is not for the Court to express, or indeed to entertain, any opinion on the expediency of a particular piece of legislation, if it is satisfied that it was within the competence of the Legislature which enacted it ; nor will it allow itself to be influenced by any considerations of policy, for these lie wholly outside its sphere. " Similar observations in regard to the doctrine of colourable legislation were made by Mukherjea, J., (as he then was), in K. C. Gajapati Narayan Deo & Others vs The State of Orissa (2), where it was observed : "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 '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 (1) , 38, 73, 74. (2) ; , 10. 244 statue is constitutional or not is thus. always a question of power. " Therefore if the Mysore Legislature had the power, which in our opinion, it had and it had not surrendered its power to Parliament which, in our opinion, it had not then it cannot be said that the imposition of the tax is a piece of colourable legislation and is on that ground unconstitutional. It will be opposite to quote at this stage the observations of Das, C.J., in the State of Bombay vs R.M.D. Chamarbaugwala (1): "For the reasons stated above, we have come to the conclusion that the impugned law is a law with respect to betting and gambling under entry 34 and the impugned taxing section is a law with respect to a tax on betting and gambling under entry 62 and that it was within the legislative competence of the State legislature to have enacted it. There is sufficient territorial nexus to entitle the State legislature to collect the tax from the petitioners who carry on the prize competition s through the medium of a newspaper printed and published outside the State of Bombay. " Thus the Central Act is with respect to betting and gambling under entry 34 of List II and the taxing sections of the Mysore Act are with respect to a tax on betting and gambling under entry 62. It is also instructive to note that Venkatarama Ayyar, J., in B. M.D. Chamarbaugwala vs The Union of India (2) in construing the language of the resolution was of the opinion that the use of the word "control and regulation" was requisite in the case of gambling and as regards regulation of competitions involving skill mere regulation would have been sufficient. In view of our finding that by passing the resolution the States did not surrender their power of taxation it cannot be said that al. (2) of article 252 (1) ; , 929. (2) ; , 939. 245 of the Constitution was violated by the amendment of the Mysore Act ; nor can it be said that in reality it was a piece of colourable legislation by an indirect attempt to amend the Central Act and a new method of control was devised by imposing a penalty under the name of tax. We have already held that the tax imposed under the Mysore Act was not by way of penalty but was the exercise of the power which the legislature possessed of imposing tax under entry 62. The next contention raised was that after the passing of the Central Act, s.12(1)(b) of the Mysore Act became, void because of the provisions of article 254(1) of the Constitution which provides : article 254(1) "If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2) the law made by Parliament whether passed before or after the law made by the Legislature of such State or as the case may be, the existing law shall prevail and the law made by the Legislature ' of the State shall, to the extent of the repugnancy, be void. " It was contended that because of the repugnancy between the Central Act and the Mysore Act in regard to licensing all provisions which had any reference to licensing became void under article 254(1) and if they were void they could not be amended. On behalf of the State it was submitted that article 252(1) was a complete code by itself and article 254 was inapplicable because the latter Article like its predecessor, s.107 of the Government of India Act, 1935, applied where the repugnancy arose under List III of the Constitution i.e., the 246 Concurrent List. It is not necessary to decide this latter contention or to refer to cases which have been relied upon i.e. Megh Raj vs Allah Rakhia (1) or Deep Chand vs The State of Uttar Pradesh & Others (2) The inconsistency would operate on that portion of the Mysore Act which became repugnant to sections 4 and 5 of the Central Act as to prohibition of prize competitions and licensing. of prize competitions e.g., s.8 of the Mysore Act and consequently that portion of s.12(1)(b) which deals with taxes in respect of prize competitions for which a licence had been .Obtained under s.8 might be said to have become void and not the rest. Therefore by the omission of words "for which a licence had been obtained", under s.8, the rest of the clause would be valid. The effect of the amending Act is that the above mentioned words were deemed to have been omitted as from April 1, 1956, and the rest of clause (b) is not repugnant to any of the provisions of the Central Act. Article 254(1) therefore did not make s.12(1)(b) wholly void. All that it did was that the portion which refers to licensing became repugnant but it did not affect the rest of the section. At the time when the Mysore Act was passed it was within the legislative power of the Mysore Legislature and it may be that it was rendered unconstitutional by reason of sections 4 and 5 in the Central Act but that portion which deals with taxation cannot be held to be void because as a result of the Amending Act the words which were repugnant to the provisions of the Central. Act were subsequently declared by. the Mysore Legislature to be deemed to have been omitted as from April 1, 1956, the day when the Central Act came into force. This is in accord with the view taken in Deep Chand vs The State of Uttar Pradesh and Others(2), i.e., the doctrine of eclipse could be invoked in the case of a 'law which was valid when made but was rendered invalid by a supervening constitutional inconsistency. This (1).(1947) L. R. 74 I.A. 12,19. (2) [1959] Supp. 2 section C. R. 8, 24,42. 247 disposes of the challenge to the constitutionality of the Mysore Act on the five points set out above. Therefore the law may be summed up as follows (1) By passing the resolutions as to control and regulation the power to tax had not been surrendered to Parliament. (2) The amending Act was not a new method of controlling prize competitions nor was it a piece of colourable legislation. (3) There was no amendment of an Act which stood repealed nor was the retroactive operation of the Amending Act affected by article 254(1) of the Constitution. The next three objections to the legality of the assessment were: (1) that the assessment was provisional which was not contemplated under the Act ; (2) there should have been a fresh notification after the amendment of the Mysore Act and (3) at the time when the recovery proceedings were taken the tax had not become due as it was payable within a week which had not expired. On September 10, 1957, the Deputy Commissioner, Bangalore, called upon the appellants to produce accounts in respect of prize competitions conducted as from April 1, 1956, up to the date of the closure of the competitions and three days were given to comply with that notice. Their reply was that the Ordinance under which the notice was issued was unconstitutional and illegal and they also asked for thirty days in which to prepare their statements but they were granted a period of fifteen days only. They agreed to file their statements within the time allowed though under protest. These statements were submitted on October 9, 1957, and at the end of the statements which showed a gross collection of Rs. 26,47,147 5 9, there was the following endorsement : "The above figures of collections are verified partly with available bank statements and partly with the books of accounts and are 248 subject to reconciliation between the amount as per ledger and that as above. The commis sion and expenses deducted by Collectors are accepted as per certificate of the Management and the State Account. Collections are verified only with. the Collection Register. (Sd.). . . . . . Chartered Accountants. " Under this the Deputy Commissioner wrote a letter on October 16,1957, in which it was said: "You are, hereby called upon to pay up provisionally a sum of Rs. 3,30,893 7 0 towards tax amount to the Reserve Bank of India and forward the challan in token of pay ment to this office within a week. " As the tax was not paid the provisions of the were resorted to. This cannot be said to be a provisional assessment. The return submitted by the appellants as far as it went was accepted and on that the tax was demanded which was not a case of provisional assessment at all but as was held by the High Court it must be taken to be a final assessment and if and when any further assessment or a revised assessment is made the question may become relevant. The next question As to the necessity of a fresh notification, the submission is equally unsubstantial. Its legality depends upon the constitutionality of amended s.12(1)(b) and if that is valid, as we have held it to be, the notification is equally valid. The notification was only in regard to the rate of taxation and had no reference to the obtaining or not obtaining of the licence. The last point raised was that the tax was payable within a week which had not expired. As we have pointed out the notice of demand called upon the appellants to pay the sum therein specified and to produce the challan in token of payment 249 within a week. It is not the case of the appellants that they had paid or were in a position to produce the challan within a week. It was not an order making the tax payable within a week. These objections, in our opinion, are without substance and are therefore overruled. In the result this appeal fails and is dismissed with costs. Appeal dismissed.

The Mysore Lotteries and Prize Competitions Control and Tax Act, 1951, was passed by the Mysore Legislature arid came into force on February 1, 1952. Some of the States comprising the Union of India passed resolutions under article 252(1) of the Constitution of India authorising Parliament to legislate for the control and regulation of Prize Competitions, and in pursuance thereof Parliament passed the , which came into force on April 1, 1956, On February 23, 1956, the Mysore Legislature adopted the said Act by passing a resolution under article 252(1) that "for the purpose of securing uniformity in legislation . the control and regulation of Prize Competitions and all other matters ancillary thereto should be regulated in the State of Mysore by the Prize Com petitions Act, 1955". The appellants who were conducting prize competitions in the State of Mysore since 1948 filed a petition under article 32 of the Constitution challenging the constitutional validity of the Act, and obtained a stay of the operation of the Act pending disposal of the petition. The judgment of the Supreme Court dismissing the petition was given on April 9, 1957, and on August 31, 1957, an Ordinance was issued, which later was enacted into an Act, Mysore Act 26 of 1957, by which the Mysore Act of 1951 was amended under which, inter alia, all prize competitions conducted between March 31, 1956, and August 31, 1957, were brought within the purview of the amended Act. As a result of this, the prize competitions which, as a result of the stay of the operation of the Central Act of 1955, were conducted by the appellants for the said period became liable for taxation. The appellants challenged the constitutional validity of the amendment on the grounds that (1) the Mysore Legislature by adopting the Central Act was no longer competent to pass any law in regard to prize competitions because the whole matter 231 including the power of taxation was surrendered in favour of Parliament; (2) even if the whole power had not been surren dered the impugned Act i.e., the Mysore Act as amended violated article 252(2) inasmuch as it indirectly amended the Central Act by adding a new method of control by imposition of penalties of a monetary nature; (3) the Mysore Legislature could not amend an Act which stood repealed as a result of the enactment of the Central Act; (4) the Mysore Act as amended was repugnant to the Central Act and was, therefore, to the extent of repugnancy, void under article 254(1) of the Constitution; and (5) it was colourable legislation inasmuch as the tax was imposed on the prize competitions with the object of controlling them. Held: (1) that by the adoption of the words "control and regulation of prize competitions and all other matters ancillary thereto" in the resolution dated February 23, 1956, the Mysore Legislature did not surrender every matter and power connected with prize competitions including the power to tax: B.R.M.D. Chamarbaugwala vs The Union of India, (1957) S.C.R. 930, relied on. (2) that the subject of "betting and gambling" in entry 34 of List II of the Seventh Schedule to the Constitution of India and that of II taxes on betting and gambling" in entry 62 of List II have to be read separately as separate powers, and, therefore, when control and regulation of prize competitions was surrendered to Parliament by the resolution dated February 23, 1956, the power to tax could not be said to have been surrendered; In re The Central Province8 & Berar Art No. XIV of and State of Bombay vs B.M.D. Chamarbaug wala; , , relied on. (3) that the tax imposed under the Mysore Lotteries and Prize Competitions Control and Tax Act, 1951, was not by way of penalty but was in the exercise of the power which the State Legislature possessed of imposing tax under entry 62, and, consequently, the amendment of the Mysore Act of 1951 could not be said to be a new method of controlling prize competitions nor was it a piece of colourable legislation. K. C. Gajapati Narayan Deo vs The State of Orissa, ; , relied on. (4) that the , dealt with "betting and gambling" in entry 34, whereas the taxing sections of the Mysore Act related to "tax on betting and gambling" under entry 62 and, therefore, article 252(2) was not contravened by the amendment of the Mysore Act, 232 State of Bombay vs R.M.D. Chamarbaugwala, (1957) S.C.R. 874,relied on. (5) that there was no amendment of the Mysore Act which stood repealed nor was the retroactive operation of the remending Act affected by article 254(1) of the Constitution. Deep Chand vs The State of Uttar Pradesh and others (1959) Supp. 2 S.C.R. 8, relied on.

Appeal No. 529 of 1958. Appeal from the judgment and decree dated March 6,1956, of the Allahabad High Court in Civil Misc. Writ No. 464 of 1954. C. B. Agwarwala, K. B. Asthana and C. P. Lal, for the appellants. M. C. Setalvad, Attorney General of India, A. V. Viswanatha Sastri and section P. Varma, for the respondent. August 22. The Judgment of the Court was delivered by SHAH, J. Under a treaty between the East India Company and Nawab Asafuddaula, the Province of Banaras was ceded about the year 1775 to the East India Company. The Company then granted a sanad to Raja Chet Singh, the former ruler of Banaras, and under that sanad, the rights and powers previously held by Raja Chet Singh were conferred afresh. Raja Chet Singh granted in jagir, pargana "Syudpore Bhettree" in perpetuity to his Diwan Ousan Singh as remuneration for services rendered to his family. Raja Chet Singh having renounced his gadi, the East India Company confirmed the grant made by the Raja in favour of Ousan Singh. Raja Chet Singh was succeeded by Raja Mahip Narain Singh who executed a sanad in favour of Ousan Singh affirming the grant. Land revenue settlements were made in the Province of Banaras about the year 1789 90, but the jagirs including "Syudpore Bhettree" were excluded from that settlement. Ousan Singh died in or 216 about the year 1800, and his son Sheo Narain Singh succeeded to the jagir. In the enquiry held by the Collector of Ghazipore into the proprietary right claimed by the jagirdar under Regulation 11 of 1819, it was declared that the grant to Ousan Singh was for life only and did not confer a heritable or transferable tenure in the parganas. The decision of the Collector was confirmed by the Commissioner of Bihar and Banaras, subject to the recommendation that Sheo Narain Singh should be maintained in possession of the parganas for life. The Government then directed in 1828 that a detailed settlement be made with the village zamindars, and offered Sheo Narain Singh allowance for life of one half of the revenue to be assessed on the pargana. Sheo Narain Singh declined to accept the offer and commenced an action in the civil court contesting the validity of the order resuming the jagir. The Government considered the question afresh, and resolved to revise the order of resumption and in July 1830, ordered that Sheo Narain Singh be considered Tahsildar of parganas "Syudpore Bhettree," and that the office be treated as hereditary devolving upon the descendants of the jagirdar and held so long as the incum bent did not infringe the privileges found to belong to other classes at the time of formation of the settlement. Sheo Narain Singh died before the resolution of the Government was communicated to him and he was succeeded by his son Harnarain Singh who withdrew the suit and signed a compromise incorporating the terms of the resolution. On August 19, 1831, the Secretary to the Government addressed to the Agent of the Governor General at Banaras a letter requesting the Secretary to the Governor General in the Pension department to prepare the necessary documents relating to the grant of a sanad specifying, that parganas "Syudpore Bhettree" were granted on an "istmrar" tenure to Harnarain Singh for his own benefit and of his heirs and successors in perpetuity_on condition of their 217 paying to Government 3/4ths of the Jamma which the revenue officers may in a resettlement of the parganas assess thereon, and that all claims to proprietary right to any village or villages situate in the Raid parganas shall be fully enquired into and in the event of any such claims being established to the satisfaction of the Government, the village or villages forming the subject of the claim shall be considered distinct from and independent of the grant and that a settlement shall be made with the proprietors as in other cases, that the office of Tahsildar shall belong to Harnarain Singh and be hereditary in his family so long as the conditions prescribed for the duties of that office be not infringed, and that in virtue of such office, the separate proprietors shall continue to pay the Jamma which may be assessed on their villages through Harnarain Singh or such other member of the family as the Government may appoint, provided that 1/4th of the Jamma of such separated villages shall be deducted from the payment to be made to the Government in lieu of all remuneration for discharging the duties of Tahsildar, and provided further that until the settlement shall be completed, Harnarain Singh shall continue to pay Jamma to Government. This proposal calling upon Harnarain Singh to bear all the expenses of the administration and any loss in collection which may occur, departed from the terms of the compromise. Harnarain Singh refused to accept the offer of a sanad on the terms set out in that letter and also the office of Tahsildar. In the meanwhile, proceedings for settlement were commenced and on November 16, 1832, the Settlement Officer reported on the conclusion of a summary settlement of the parganas that in 166 mahals, the village zamindars established proprietary rights and the revenue. assessed upon them was Rs. 1,28.1960. He further reported that 12 mahals of which the gross revenue was Rs. 22,840 were settled with the jagirdar at a reduced revenue of Rs. 17,130. Harnarain Singh having refused to undertake 218 the office of Tahsildar on the terms offered by the Government, the Board of Revenue suggested that Harnarain Singh should receive 1/4th of the net collections after deducting from the gross collection the cost of Tahsil establishment thereby giving him an income of Rs. 36,322 8 0. The Board of Revenue recommended that a sanad be issued under the authority of the Lt. Governor conferring "the pension of Rs. 36,322 8 0 on Babu Harnarain Singh and his heirs in perpetuity". In a letter dated September 13, 1837, it was recorded that the Lt. Governor of N.W.F. Province was of the view that it would be more conformable with the terms of the agreement if the allowance on Harnarain Singh 's villages (12 mahals) were given in the form of a remission of revenue to the amount of one fourth, the Jamma being fixed at Rs. 17,130 instead of Rs. 22,940 and in the villages settled with zamindars (166 mahals) Harnarain Singh be paid annually a pension of 1/4th of the collections after deducting the Tahsildari charge, and on that footing Rs. 30,612 8 0 be granted to Harnarain Singh. By letter dated October 19, 1837, from the Secretary to the Lt. Governor, N.W.F. Province, the Secretary to the Board of Revenue was informed that the Lt. Governor had resolved to adopt the Board 's recommendation made in their letter dated September 26, 1837, and to allow Harnarain Singh 1/4th of the not collections after deducting the, expenses of the Tahsildari establishment i. e., Rs. 30, 612 8 0 out of a net Jamma of the villages amounting to Rs. 1,28,960. About the 12 mahals settled with Hamarain Singh, the allowance was directed to be made in the form of a remission of 1/4th of revenue assessed. Finally, by letter dated September 14, 1838, from the Secretary to the Sadar Board of Revenue to the Officiating Commissioner 5th Division, Banaras, it was stated that " 'what the Government intended to give is a clear fourth of the net revenue of the Pargana to the Muqurrureedar as pension". The letter further stated. 219 "2. The arrangement of paying a portion of that pension by a remission of revenue on certain mauzas settled, as was supposed, directly with the muqurrureedar was proposed by the Board and allowed by Government as a mere matter of convenience to the parties. Neither Government nor Board intended to alienate any part of the 'muqurrureedar 's pen sion to his son or to any other person. If the mauzas supposed to have been settled with the muqurrureedar for his own use and behalf, turn out to be held by another person on a distinct interest, it will be necessary, the Board observe to modify the arrangement previously allowed and to collect the, whole assessed revenue of those mauzas as of all others ; and when the same shall have been collected to pay the Muqurrureedar his clear fourth of the net collections. As however, these mauzas were settled by the Government with the Muqurrureedar his responsibility for the Jumma any portion of revenue which may fall in arrear by person or the arrangement made by him, or of the domes tic differences of his family, must be made good from his pension, before the assignment of the fourth share of the net collections can have effect. The Board must consider the Muqurrureedar as the owner of these villages during his life. With his family arrangements they have no concern. But if it will be his wish that the whole revenue be collected from these villages, and one fourth be returned to him from the treasury instead of receiving tha t fourth in the shape of a remission, he is at liberty to make the election. He is also the Board remark of course at liberty to cause those mauzas to be 220 transferred or sold in the case of arrear, but his responsibility for the assessed Jumma as fixed by the act of settlement will remain the same. It is manifest that the recommendations made by the Board of Revenue and the Secretary to the Government in the lengthy correspondence varied from time to time, but in the final letter it appears to have been made clear that an amount equivalent to 1/4th of the net revenue of the 166 mahals be given as pension annually to the jagirdar. A formal sanad, though contemplated, was, it appears, never issued, but it is common ground that the allowance was paid through the Treasury Office of the Collector of Ghazipor year after year since the year 1838 to Harnarain Singh and his descendants. This allowance to the jagirdar of "Syudpore Bhettree" was called sometimes in the revenue papers "malikana" sometimes pension" and sometimes a "share in the revenue of the entire pargana '. In 1951, the U. P. Legislature enacted the Uttar Pradesh Zamindari Abolition and Land Reforms Act 1 of 1951, and relying upon section 6(b) of the Act, the revenue authorities stopped payment of the allowance to the descendants of Harnarain Singh. The respondent who is a descendant of Harnarain Singh then presented Writ Petition No. 464 of 1954 in the High Court of Judicature at Allahabad for a writ in the nature of mandamus calling upon the State of Uttar Pradesh to forbear from interfering with his right to regular payment of the "pension, allowance or malikana" payable in. lieu of the hereditary estate of Harnarain Singh in respect of parganas "Syudpore Bhettree" and for an order for payment of the "pension, allowance or malikana" as it fell due. The respondent claimed inter alia that by virtue of the notification issued under section 4 of the Act, his right to receive the pension did not cease, especially when the scheme of the Act and the principle of assessment did not contemplate payment 221 of compensation in respect of extinction of his right to the allowance, and that in any event, there was no nexus between the pension and the estates sought to be acquired under Act 1 of 1951 or the zamindari: system so tight to be abolished, because the pension was neither land nor Immovable property nor an estate within the meaning of the Act and being merely compensation payable to him in lieu of the rights of his ancestors over the estates comprised within the pargana "Syndpore Bhettree", it was not liable to vest in the State. The High Court rejected certain preliminary objections to the maintainability of the petition (which objections are riot canvassed in this appeal) and held that the right of .the respondent to receive Rs. 36,330 per annum was not an "estate" within the meaning of the Act and that the right was not acquired under the Act nor did compensation fall to be paid for the same. In the view of the High Court, under section 6 of the Act, only the rights of the intermediaries in respect of land revenue of the lands comprised in the estate were extinguished and that the rights of third parties under a contract with the State not relating to the rights and privileges of intermediaries, tenants or other persons having interest in land were not effected, and the predecessors in interest of the respondent having been granted an allowance. annually in lieu of abandonment of the right to realise land revenue, the arrangement did not come to an .end because of the "abolition of the zamindari" under the Act. The question which falls to be determined in ,this appeal by the State of Uttar Pradesh, is whether the right of the respondent to receive the allowance under the arrangement of the year 1838 was extinguished as a consequence ensuing from the vesting of the "Sudpore Bhettree" parganas in the State of Uttar Pradesh under section 4 of the Act. By the preamble. it was recited that the Act was enacted to provide for the abolition of the 222 zamindari system which involved intermediaries between the tiller of the soil and the State and for the acquisition of their rights, title and interest and to reform the Law relating to land tenure consequent upon such abolition and acquisition and to make provision for other matters connected therewith. By s.3 (8) which was retrospectively are ended by Act 14 of 1958, , 'estate" was defined as meaning the area included under one entry in any of the registers described in cls. (a) to (d) and in so far as it relates to a permanent tenure holder in any register described in el. (e) of section 32 of the U. P. Land Revenue Act 1901 as it stood immediately prior to the coming into force of the Act or subject to the restrictions mentioned with respect to the register described in el. (e) in any of the registers 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 included share in or of an estate. " 'Intermediary" was defined as meaning with reference to any estate, a proprietor, under proprie tor, sub proprietor, the kadar, permanent lessees in Avadh and permanent tenure holder of such estate or part thereof. "Land" was defined as meaning,, except in sections 143 and 144, as land held or occupied for purposes connected with agriculture, horticulture or animal husbandry which included pisciculture and poultry farming. By s.4, provision was made for vesting of estates in the State of Uttar Pradesh. By sub s.(1), it was enacted, insofar as it is material, that the State Government may by notification declare that as from a date to. be specified, all estates situate in Uttar Pradesh shall vest in the State and from the date so specified, all such estates shall stand transferred to and vest, except as provided in the Act, in the State free from all encumbrances. Section 6 provided for the consequences of an estate in the State. On the publication of a notification under section 4 of the Act, notwithstanding anything contained in any contract or document or in any other law for the time being in force and, nave as 223 otherwise provided in the Act, the consequences set forth in cls.(a) to (j) of section 6 were to ensue in the area to which the notification related. By cl.(a), all rights, title and interest of intermediaries in every estate in such area and in the sub soil in such estate including rights, if any, in mines and minerals ceased and vested in the State. Clause (b) on which the dispute primarily turns, provided : "All grants and confirmations of title of or to land in any estate so acquired, or of or to any right or privilege in respect of such land or its land revenue shall, whether liable to resumption or not determine." By cl. (c), all rents, local rates and sayar in respect of any estate or holding therein for any period after the date of vesting and which, but for the acquisition, would be payable to an intermediary, vested in and became payable to the State Government and not to the intermediary ; and where under an agreement or contract made before the date of vesting any rent, cess, local rate or sayar for any period after that date had been paid to or compounded or released by an intermediary, the same, notwithstanding the agreement or the contract, became recoverable by the State Government from the intermediary. By cls. (d) and (e), liability of intermediaries in respect of any estate incurred for any period prior to the date of vesting remained enforceable. By cl. (f), the interest of intermediaries in any estate was exempt, from attachment or sale in execution of any decree or other process of any court and any attachment existing at the date of vesting or any order for Attachment passed before such date, subject to the provisions of section 73 of the , ceased to be in force. By cl. (a), mortgages with possession on any estate or part of an estate on the date immediately preceding the date of vesting were to be deemed to have been substituted by simple mortgages without prejudice to the rights 224 of the State Government '. By el. (h), no claim or liability enforceable or incurred before the date of vesting by or against an intermediary for any money charged on or secured by a mortgage of an estate or part thereof was, except as provided in 73 of the , to be enforceable against his interest, in the estate. By el. (i), all suits and proceedings of the nature to be prescribed pending in any court at the date of vesting and. ' all proceedings upto any, decree or order passed in any such suitor proceeding previous to the, date of vesting were stayed. By cl. (j), all mahals and their subdivisions existing on the date immediately preceding the date of vesting and all engagements for the payment of land revenue or rent by a proprietor, under proprietor, sub proprietor co sharer, or lambardar as such determined and ceased to be in force. Section 37 to 40 of the Act provided for the preparation of the Compensation Assessment Roll of intermediaries as respects mahals and for preparation of gross assets of mahals. It was on this Compensation Assessment Roll that the compensation payable for loss of interest of the intermediaries was to be computed and paid. Section 42 provided for computation of gross assets of an intermediary and section 44 for computation of the net assets of an intermediary. Section 45 provided that in the case of proprietors to whom section 78 of the U.P. Land Revenue Act, 1901 applied or who were as. signers of land revenue whose. names were recorded in the record of rights, maintained under cls. (a) to (d) of section 32 of the said Act, under proprietors, sub proprietors, permanent tenure holders and, permanent lessees in Avadh, the provisions of sections 39 to 44 were to apply subject to such incidental changes and modifications as may he Prescribed and the gross assets and net assets of such intermediaries were to be computed accordingly. ' 225 By the definition, in section 3 (8) of the Act an "estate" is an area included under one entry in the registers described in cls.(a) to (d) of the Land Revenue Act. The High Court upheld the contention of the respondent that allowance paid to him could not be regarded as an "estate". That view is not challenged before this Court by counsel for the State of Uttar Pradesh. The right to receive the allowance of Rs. 30,612 8 0 from the Government under the arrangement cannot, in the absence of an express provision to that effect, be called "an area included under one entry in any of the registers" described in the various clauses. The first part of section 6(b) does not therefore assist the claim made by the State. But of the 12 mahals the respondent was a proprietor : the land of the mahals was "estate" within the meaning of section 3(8) of the Act and by section 4, the right of the respondent in that estate stood vested in and transferred to the State. It is true that by the arrangement of the year 1838, confirming the earlier compromise, remission of 25% as granted to the respondent 's predecessors in respect of payment of land revenue. If the right of the respondent in the 12 mahals ceased, the right to remission could not be converted into a positive right to receive the amount thereof, notwithstanding the extinction of his right in those 12 mahals. The right to remission of land revenue was a right in respect of land revenue in the estate which stood vested in the State. The letters dated September 13, 1837, October 19, 1837 and June 15, 1838 make it abundantly clear that the difference of Rs. 5710 between the amount originally assessed and the Jamma recoverable was to be remission of revenue. The right of the respondent to the 12 mahals was transferred to the State by virtue of the notification under section 4, and the consequences set out in sub section (b) of section 6 relating to those 12 mahals ensued. We are therefore unable to agree with the 226 High Court that for the amount of Rs. 6710 which was treated as remissions the respondent was entitled to obtain relief on the footing that right was not affected by the issue of the notification under section 4 of the Act. The claim of the respondent in respect of the allowance granted as consideration for abandonment of the right to 166 mahals rests on a firmer ground. It is true that this allowance ",as computed as 1/4th share of the revenue assessed on the 166 mahals. But the respondent under the arrangement has no interest in the land of the 166 mahals or in the land revenue payable in respect thereof. By the order of the Government, the right of Sheo Narain Singh to the entire pargana "Syudpore Bhettree" was resumed. Sheo Narain Singh challenged the authority of the Government to resume his interest in the Jagir and dispute pending in the civil court was compromised on the terms which were finalised in the year 1838 whereby Harnaram Singh and his descendants were given an allowance in amount equal to 1/4th of the net revenue of the 166 mahals. Because the annual allowance is equal to a fourth share of the net revenue of the mahals, the right of the respondent does not acquire the character of an interest in land or in land revenue. Under the arrangement, the entire land revenue was to be collected by the Government and in the collection Harnarain Singh and his descendants had no interest or obligation. As a consideration for relinquishing the right to the land and the revenue thereof, the respondent and his ancestors were given an allowance of Rs. 30,612 13 0. The allowance was in a sense related to the land revenue assessed on the land, i.e., it was fixed as a percentage of the land revenue : but the percentage was merely a measure, and indicated the source of the right in lieu of which the allowance was given. The amount is described as "pension" in the letters dated September 14, 1838, July 7, 1837 and June 15,1838. The words used in el. (b) are undoubtedly wide 227 any right to a grant which has relation to land or land revenue would be determined by the operation of that clause. But the allowance to Harnarain Singh was not in respect of land or its revenue; it was granted as consideration for settlement of a claim litigated in a civil court relating to that land. The primary object of the legislature, as set out in the preamble of the Act, was to abolish the zamindari system and to acquire the rights of the intermediaries and to pay compensation for acquisition of those rights. By section 4, estates in the area for which a notification was issued, vest in the State free from all encumbrances and as a consequence of vesting, the rights of intermediaries, but not their preexisting liabilities are extinguished as from the date of vesting. Clauses (a),(c) to (f) and (b) expressly deal with the rights and obligations of interme diaries, and the interaction thereon of the notification of vesting. Clause (g) deals with the derivative rights of mortgagees of estates. By el. (i), the mahals and sub divisions are obliterated, and the engagements for payment of land revenue or rent by proprietors, under proprietors, sub proprietors, co sharers and sub sharers cease. There is no express reference in section 6 (b) to the right of intermediaries ; by the first part of that clause, the grant and confirmation of title to land in an estate are determined and by the second part, the rights and privileges in land or in the land revenue in the estates are determined. The key words of the second part of the clause are "in respect of" indicating a direct connection between a right or privilege and land in an estate or its revenue. The intention of the legislature is manifestly to extinguish estates and all derivative rights in estates and to extinguish the interest of intermediaries between the State and the tiller of the soil. If the grant or confirmation of title is in respect of a right or privilege to land in an estate or its revenue, it must determine under cl. (b) ; but a right to receive an allowance which is 228 granted in consideration of extinction of a right to land or land revenue does not, by the force of cl. (b) determine. The allowance has not the quality of land or land revenue : its quantum only was measured by equating it with a fourth share in the net revenue of a part of land which was the subject matter of the suit in which the arrangement for payment of the allowance was made. Absence of a provision in the Act for payment of compensation for a right such as the one claimed by the respondent strongly supports the plea that the right is not intended to be acquired or extinguished. Section 37 to 44 deal with the assessment of compensation to be paid to intermediaries. Compensation Assessment Roll of intermediaries in respect of the mahals has to be prepared and detailed instructions in that behalf are contained in sections 39 to 44. By section 45, in computing the gross assets and net assets of proprietors who are assignees of land revenue and of under proprietors, sub proprietors, permanent tenure holders and permanent lessees in Avadh sections 39 to 44 of the Act are applicable subject to such modifications and incidental changes as may be prescribed. It is common ground that s.78 of the U. P. Land Revenue Act has no application to "Syudpore Bhettree" pargana. To proprietors who are assignees of land revenue and whose names are recorded in the record of rights maintained under s.32 cls. (a) to (d), the provisions of ss 39 to 44 may undoubtedly apply subject to modifications as may be prescribed, and computation of their gross and net assets may be made accordingly. But the respondent is not an assignee of land revenue whose name is so recorded in the record of rights nor is he qua the allowance an under proprietor, sub proprietor, permanent tenure holder or permanent lessee. Section 45 is a machinery provision : it does not purport to extend the field of s.6 by prescribing consequences which are not incorporated in that section. There is in s.45 nothing to warrant the submission of counsel for the State that rights of a 229 land holder to receive allowances from the Government are extinguished even without compensation, merely because he was an assignee of land revenue of some land or was a proprietor, sub proprietor, permanent tenure holder or permanent lessee in respect of other land in Avadh. The scheme for payment of compensation prescribed by sections 39 to 44 is extended to amongst others, proprietors of land who are assignees of land revenue whose names are recorded in the record of rights maintained under cls. (a) to (d) of s.32 : but, a person receiving an allowance from the State of the character received by the respondent is not a proprietor who is an assignee of land revenue, and in any event, if his name is not entered in the revenue record under cls. (a) to (d) of s.32, the provisions relating to computation of gross and net assets will not apply to him. Absence of a provision in the Act for awarding compensation to persons holding interest such as the respondent has strongly supports the view that such interest was not to be extinguished by the operation of s.6(b) of Act 1 of 1951. We accordingly hold that the High Court was right in granting the application preferred by the respondent insofar as it related to the allowance of Rs. 30,612 13 0 granted as a consideration for extinction of the right of Harnarain Singh to 166 mahals : but for reasons already stated, we are unable to agree with the High Court that the respondent was entitled to receive in respect of the 12 mahals the land revenue which was remitted. The order passed by the High Court will therefore be modified and the petition of the respondent in so far as it deals with remission of land revenue in respect of the 12 mahals of "Syudpore Bhettree" will stand dismissed. The order of the High Court in respect of the allowance of Rs. 30,612 13 0 will stand confirmed. Subject to the above modifications, the appeal will stand dismissed with costs. Appeal dismissed.

By the order of the then Government the right of S, an ancestor of the respondent, to the entire parganas "Syudpore Bhettree" was resumed. S challenged in a civil court the authority of the Government to resume his interest in the jagir. During the pendency of the dispute, settlement proceedings were commenced and in 1832 the Settlement Officer reported that to 166 mahals of the "Syudpore Bhettree" pargana, the village zamindars had established their proprietary rights and only on 12 mahals the proprietary right of S had been established. The dispute pending in the Civil Court was compromised, and the terms were finalised in 1838 with H, son of S (who had died in the meantime). The terms, inter alia, were that for 214 166 mahals settled with the Zamindars, H, and his heirs in perpetuity, be paid annually a pension of 1/4th of the collections after deducting the Tehsildari charges and for 12 mahals settled with H allowance be made in the form of remission of 1/4th of the revenue assessed. The Government under the settlement intended to give a clear fourth of the net revenue of the parganas as pension. The allowance and/ or pension was paid through Treasury Office year after year from 1838 to H and his descendants. In 1951 the U.P. Legislature enacted the Uttar Pradesh Zamindari Abolition and Land Reforms Act 1 of 1951, and under s.6(b) of the Act the revenue authorities stopped payment of the allowance to the respondent. The respondent claimed that by virtue of the notification issued under s.4 of the Act his right to receive pension did not cease because the pension was neither land nor immovable property nor an estate within the meaning of the Act and being merely compensation payable to him in lieu of the rights of his ancestors over the estates comprised within the pargana "Syudpore Bhettree", it was not liable to vest in the State. Held, that the right to receive the allowance of Rs.30,612 8 0 for 166 mahals from the Government under the, arrangement was not in respect of land or its revenue; it was granted as consideration for settlement of a claim litigated in a civil court relating to that land, and could not in the absence of an express provision to that effect be called "an area included under one entry in any of the registers" described in various clauses, (a) to (d) of s.32 of the U.P. Land Revenue Act, 1901. The intention of the Legislature was to extinguish estates and all derivative rights in estates and to extinguish the interest of intermediaries between the State and the tiller of the soil. The grant of confirmation of title which is in respect of a right or privilege to land in an estate or its revenue; it must determine under cl.(b) of s.6 of the Act; but a right to receive an allowance granted in consideration of extinction of a right to land or land revenue does not by the force of cl. (b) determine. The allowance has not the quality of land or land revenue; its quantum only was measured by equating it with a fourth share in the net revenue of a part of land which was the subject matter of the suit in which arrangement for payment of the allowance was made. A person receiving an allowance from the State in consideration "of extinction of a right to land or land revenue is not a proprietor who is an assignee of land revenue," and in particular if his name is not entered in the revenue record under cls.(a) to (d) of s.32 of the U.P. Land Revenue Act, 1901, the provisions relating to computation of gross and net assets will not apply to him. The Act does not intend to extinguish the right to receive allowance granted in 21 considerations of extinction of right to land or land revenue by the operation of s.6(b) of the Act 1 of 1951. Held, further, that the respondent was a proprietor of the 12 mahals, of the "Syudpore Bhettree" Parganas. The said 12 mahals were an "estate" within the meaning of s.3(8) of the Act and by section 4 the right of the respondent in that estate stood vested in and transferred to the State. The right of the respondent in the 12 mahals having ceased, the right of remission could not be converted into a positive right to receive the amount thereof.

Appeal No. 397 of 1960. Appeal from the judgment and order dated. ' November 24, 1958, of the Kerala High Court ill I. T. R. No. 23 of 1957. K. N. Rajagopala Sastri and I P.C. Menon, for the appellant. A. V. Viswanatha Sastri Narayanaswami and R. Gopalakrishnan, for the respondent. August 14. The Judgment of the Court was delivered by SUBBA RAO, J. This appeal by certificate ' granted by the High Court of Kerala raises the question of the application of a. 41(1) of the Indian Income tax Act (hereinafter called.the Act) to the fact of the case. 139 One P. B. Umbichi and his wife executed a deed dated December 20 191.5 creating thereunder a wakf of their properties. It was provided therein. , inter alia that the income from the properties mentioned therein should be utilised for the maintenance of their two daughters and their children on the female side. For 40 years upto and inclusive of the assessment year 1954 55, the income tax assessments were made on the wakf through its manager under section 41 of the Act in the status of an individual. But, for the assessment year 1955 56, the Income tax Officer treated the assessee as an association of persons, and, on the ground that the shares of the beneficiaries are indeterminate, levied tax at the maximum rate under the first proviso to section 41 of the Act. On appeal, the Appellate Assistant Commissioner of Income tax held that the Income tax Officer was not right in holding that the members of the family were indeterminate, but he confirmed the assessment for the reason that, the shares were not specified among the individual members of the family and also between the members of the family on the one hand and the charitable and religious purposes on the other, the first proviso to section 41 would be applicable to the assessee. On further appeal, the Income tax Appellate Tribunal took the View that the proprietary rights in the property in question vested in the Almighty and that the Mutawalli was only to look after ant administer the properties as a manager and, therefore, the proper person in whose hands the income from the properties should be assessed was the Mutawalli in his status as an "individual" at the rates applicable to an individual. ID that, view, the appeal was allowed. At the instance of the Commissioner of Income tax, the 'Appellate Tribunal referred to the High Court of Kerala the following question for its determination : "Whether in the facts and circumstances of the case, the first proviso to section 41 is applicable". 140 The High Court held that the said proviso was not applicable, as under the wakf deed the beneficiaries and their shares were ascertainable. Aggrieved by the said order, the Commissioner of Income tax has preferred the present appeal. Mr. Rajagopala Sastri, learned counsel for the Commissioner of Income tax, contended that on a fair reading of the terms of the wakf deed it would be clear that the Mutawalli was only directed to maintain the members of the family, that none of the members of the family had any ascertainable &hare in the income, and that, therefore, the case squarely fell within the first proviso to section 41 of the Act. Mr. Viswanatha Sastri, learned counsel. for the respondent, in addition to his attempt to sustain the construction put upon the wakf deed by the High Court, contended that the instant case fell outside the scope of section 41(1) of the Act, as the Mutawalli was only receiving the income, on behalf of the Almighty, that the Almighty was not a "Person", and that, therefore, as the main, section (lid not apply, the proviso also would not be attracted, with the result that the Muta award would have to be assessed as an "individual". As the argument turns upon the construction of section 41 of the Act, it will be convenient at"the outset to read the relevant parts thereof. "Section 41 : (1) In the case of income, profits or gains chargeable under this Act which. any trustee or trustees appointed under a trust declared by a duly executed instrument in writing whether testamentary or otherwise, including the trustee or trustees under any Wakf deed which is valid. under the , are entitled to receive on: behalf of any person, the 'tax shall be levied upon and recoverable from such. trustee trustees, 141 in the like manner and to the same amount as it would be leviable upon and recoverable from the pers on on whose behalf such income. profits or gains are receivable, and all the provisions of this Act shall apply accordingly : Provided that where any such income, profits or gains or any part thereof are not specifically receivable on behalf of any one person, or where the individual shares of the persons on whose behalf they are receivable are indeterminate or unknown, the tax shall be levied and recoverable at the maximum rate, but, where such persons have no other personal income chargeable under this Act and none of them is an artificial juridical person, as if such income, profits or gains or such part thereof were the, total income of an association of persons. " This section in term s applies to a trustee under a wakf deed which is valid under the . Under the substantive part of. the section, tax is leviable on the trustee of the wakf in the like manner and to the same amount as it would be leviable upon and recoverable from the beneficiary,that is,the assessment would be at the individual rates of tax applicable to the beneficiary. But, under the first proviso to that section, there are two exceptions to the general rule, viz., (1) where the income is not specifically receivable on behalf of anyone person; and (ii) where the individual shares of the persons on whose behalf the income is receivable are indeterminate or unknown. In those two circumstances tax shall be levied and recoverable at the maximum rate. It is agreed that the first exception does not apply to the instant case. But the question that falls to be decided is whether the individual shares of the persons on whose behalf the income is receivable are indeterminate or unknown. The answer to the question depends upon the construction of the 142 provisions of the Wakf deed. The Wakf deed was executed on December 20, 1950 by Umbichi and his wife dedicating their entire property, moveable and immoveable, of total value of rupees one lakh for the objects mentioned therein. The Mutawalli appointed thereunder was directed to manage the properties in such a way as "to do acts necessary for charitable purposes and, to meet the maintenance expenses of their children and grand children and the female children that might be born to them in future, and to the male children born to the said female children". The document proceeded to give further specific directions in the management of the properties. After payment of taxes and meeting the expenses incurred for repairs and maintenance of the properties, the balance of the income should be utilised for the "daily necessary expenses of the house and food expenses as we are doing now", and for purchasing "dresses and other necessities for the then male and female members of the tarwad" and for conducting "nerchas (ceremonies) ,such as Yasin, Moulooth, etc., charitable ceremonies for feeding the poor and such other necessary expenses , and out of the balance, if any, the Mutawalli was directed to acquire properties yielding good income. The rest of the recitals in the document are not relevant for the present purpose. Can it be said that, under the document, the individual shares of the beneficiaries are specified ? The document does not expressly specify the shares of the beneficiaries; nor does it do so by necessary implication. Indeed, ' the individual shares of the beneficiaries Are not germane to the objects of the document. The Mutawalli was directed to bear, out of the income the expenses necessary for maintaining the members of the tarwad and to conduct the necessary religious ceremonies. The distribution of the family income and: family expenses was left to the discretion of the 143 Mutawalli, the document also further contemplated that the Mutawalli by his prudent and efficient management would save sufficient amounts for purchasing properties. The 'directions indicate beyond any reasonable doubt that no specified share of the income was given to any of the benefit series, and their right was nothing more, than to be maintained having regard to their reasonable requirements which were left to the discretion of Mutawalli. While it is true that the number of beneficiaries would be ascertainable at any given point of time, it is not possible , to hold, as the High Court held, that under the document the beneficiaries had equal shares in the income. The beneficiaries had no specified share in the income, but only had the right to be, maintained. The construction put upon the document by the High Court cannot, therefore, be sustained on the plain wording of the document. 'We, therefore bold that under the terms of the document the individual shares of the beneficiaries are indeterminate within the meaning of the first proviso to section 41(1) of the 'Act. If so, under the said proviso, the assessee is ,liable to pay income tax, at the maximum rate. The alternative contention of learned counsel 'for the respondent remains to be considered. The argument is that 'under the Wakf deed the properties vest in the Almighty and, therefore, the Mutawalli receives the income 'only on behalf of the Almighty and not on behalf of any person within the ' meaning of section 41(1) of the Act, with the result that section 41(1) is not applicable to the assessment in question. The argument is rather subtle, but it has no force. There are three effective answers to this contention Firstly, it was not raised before the High Court the only question argued before the High Court was whether the beneficiaries of the trust and their individual shares of the income of the trust were ascertainable. 144 Secondly, though under the Mahomedan Law the properties dedicated under a Wakf deed belong to the Almighty, it is only in the ideal sense, for the Mutawalli in the name of the Almighty utilises the income for the purposes and for the benefit of the beneficiaries mentioned therein. Under the Mahomedan Law, the moment a Wakf is created all rights of property pass out of the wakf and vest in the Almighty. 'The property does not vest,in the, Mutawalli, for he is merely a manager and not a trustee in the technical sense. 'Though Wakf property belongs to the Almighty, the practical significance of that concept is explained ill Jeuwun Dass Sahoo vs Shah Kubeer ood deen (1) thus : ". . . . Wakf signifies the appropriation of a particular article in. such a manner as subjects it to the rules of divine property, whence the appropriator 's right in it is extinguished, and it becomes a property of God, by the advantage of it resulting to his creatures . " That is, though in an ideal sense the property yet in the Almighty, the property is held for the benefit of His creatures, that is, the beneflciaries. 'Though at one time it was considered that to constitute a valid Wakf there must be dedication of property solely to tbe Worship of God or for regious or charitable, purposes, the Wakf Validating ,Act, 1913, discarded that view and enacted by section 3 that a Mussalman can create a wakf for the maintenance and support, wholly or partially, of his family, children or descendants,provided the ultimate benefit is expressly or impliedly reserved for the poor or for any other purpose recognised by the Mussalman law as a religious, pious or charitable purpose of a permanent character. Section 4 of the said Act, goes further and says that a wakf shall not be invalid by the mere ' circumstance that tile benefit (1) (1840)2. M.I.A. 390, 421. 145 reserved for the poor or for religious purposes is postponed until the extinction of the family It is, therefore, manifest that under the Mahomedan Law, the property vests only in the Almighty, but the Mutawalli, acting in ' His name, utilises the income for the advantage of the beneficiaries. Therefore, the words ,,on behalf of any person" in section 41 of the Act , can only mean on behalf of the beneficiaries and not on behalf of the Almighty. The third and more effective answer to the argument is that section 41(1) of the Act provides for a vicarious assessment in order to facilitate the levy and collection of income tax ' from a trustee in respect of income of the ' beneficiarios. In express terms it equates the Mutawalli of a wakf to a trustee. For the purpose of section 41 the Mutawalli is treated as a trustee and, on the analogy of a trustee, he holds the property for the benefit of the beneficiaries. There is no scope for importing the Mahomedan Law of Wakf in section 41 when the section in express terms treats the Mutawalli as a trustee, though he is not one in the technical sense 'under the Mahome 'dan Law. If the argument of learned counsel for the respondent be accepted, it would make section 41 of the Act otiose so far as wakfs are concerned, for in every case of wakf the property I would be held for the Almighty and not for any person. We, therefore, reject this contention and answer the question in the affirmative. In the result, we set aside the order of the High Court and hold that the, respondent was rightly assessed by the Income tax Officer at the maximum rate. The appeal is allowed with costs. Appeal Allowed.

The question for determination in the appeal was whether the wakf in question should be assessed to tax under s.41 (1) of the Indian Income tax Act. 1922, through the manager as individual or as an association of persons at the maximum rate under the first proviso to that section on the ground that the individual shares of the beneficiaries were indeterminate and unknown. The wakf deed directed the mutawalli to do acts necessary for charitable purposes and to meet the maintenance expenses of the wakif 's children, grand children, the female children born in the future and the male children born to the said female children and after payment of taxes and meeting of expenses for repairs,and maintenance of properties, to utilise the balance of the income for daily necessary expenses of the house and for food for purchasing dresses and other necessities for the and female members of the tarwad. for conducting specified ceremonies, for feeding the poor and for. meeting such. other then necessary expenses and thereafter to utilise the balance, if any, in acquiring properties yielding good income. 138 Held that under the terms of the wakf deed the individual shares of the beneficiaries were indeterminate within the meaning of the first proviso to s.41 (1) of the Indian Income tax Act, 1922, and as such the assessee was liable to pay income tax thereunder at the maximum rate. It was not correct in view of ss.3 and 4 of the , to say that under the wakf deed the property vested in the Almighty and the Mutawalli did not therefore, receive the income on behalf of any person within the meaning of s.41 (1) of the Indian Income Tax Act and as such the proviso could not come into operation. Under the Mahomedan law wakf property vests in the Almighty only in an ideal sense and the Mutawalli, acting in his name, utilises the income for the advantage of the beneficiaries. The words "on behalf of any person" in s.41 of ' the Act, therefore, could only mean on behalf of the beneficiaries and not on behalf of the Almighty. Jewun Doss Sahoo vs Shah Kubeer ood deen, (1 841) 2 M.I. A. 390, referred to. Held, further, that there was no scope for importing the Mahomedan Law of wakf in s.41 of the Act since that section in express terms treated the Mutawalli as a trustee though he is not one in the technical sense under the Mohamedan Law.

Appeal No. 328,of 1958. Appeals from the judgment and order dated September 12, 1956, of the Calcutta High Court in Appeal from Original Order No. 15 of 1955. B. Sen P. K. Chatterjee and P.K. Bose, for the appellants. Dipak Datta Choudhri and P. D. Menon., for respondent No. 2. 1961. August 16. The Judgment of the Court was delivered by SUBBA RAO, J. This appeal raises the question of construction of the expression ,,telegraph line" in section 34(2)(b) of the (Act 9 'of 1910), (hereinafter called the ' Act). The first respondent, Laxmi Narayan Chopra, carries on business, as motor coach builder;, under the name and style of "Chopra Motors" having, his factory at 139, Regent Park, Tollygunge in the suburbs of Calcutta., In the said factory a number of "Universal Electric Motors" are operated for the purpose of working electric drills. Within a distance of 100 feet of the said factory, there is a Post and Telegraph Wireless Station, which, besides functioning as a coast station communicating with ships at sea, handles public messages in large volume from Darjeeling, Shillong, Gauhati, Agartala and New Delhi. In or about Aril, 1953 severe electrical interference was observed in the said station and experts attributed the same. to local induction from the first respondent 's factory. On October 13, 1953, the Senior Electric Inspector issued a notice to the first respondent to show cause writing as to why an order under section 34(2)(b) of the Act, read with notification No. 4193 COM, dated August 1 14, 1929 requiring discontinuation of the operation of the Universal Electric Motors in the 149 said factory premises should ' not be made. After some correspondence: on: December 1, 1953, the Senior Electric Inspector made an order under a. 34(2)(b) of the Act requiring the first respondent to remedy the injuries affecting the lines used for wireless telegraphic communications at the Wireless Receiving Centre. On January 12, 1954, the first respondent filed a petition in the High Court at Calcutta under article 226 of the Constitution pray for a writ of mandamus or any other appropriate mug writ directing the appellants to withdraw and cancel the said order and to forbear from giving effect to the same. The petition came up for hearing, in the first instance, before Sinha J., of that Court. It was contended, interalia, that there was no "telegraph line" in the Post and Telegraph Wireless Station within the meaning of s.34(2)(b) of the Act, and, therefore, the notice issued by the Senior Electric Inspector was without jurisdiction. Sinha J., rejected the contention and dismissed the petition. But on appeal, a division bench of that High Court, consisting of Mookerjee, A. C, J., and H. K. Bose J., accepted the contention of the first respondent and issued a writ as prayed for. The present appeal is directed against the said order. Learned counsel for the appellants contends that the definition of ", 'telegraph line" in the , (Act 13 of 1885), which is included by reference in the Act, is wide, enough to take in electric lines used for the purpose of wire. less telegraph and that the Appellate Bench of the High Court went wrong in invoking the old maxim contemporanea expositio est optima et fortissima in lege in construing the provisions of a modern state. The first respondent is ex parte; but in this case hisviewpoint is forcibly expressed in the judgment of the High Court under appeal. To appreciate the rival contentions, it is necessary at the outset. to read I the relevant provisions of the Act and the Telegraph Act. 150 The Section 34. (2) If at any time it is estab lished to the satisfaction of the appropriate Government (b)that any electric supply lines or other works for the generation, transmission, supply or use of energy are attended with danger to the public safety or to 'human life or injuriously affect any telegraph line, the appropriate Government may, by order in writing, specify the matter complained of and require the owner or user of such electric supply lines or other works to remedy it in such manner as shall be specified in the order, and may also in like manner forbid the use of, and the supply of energy to, any electric supply line or works 'until the order is complied with or for such time as is speci fied in the order. Section 2. In this Act, expression,. ; defined in the , or in the , have the meanings assigned to them in either of those Acts. . The Section 3. (1) "telegraph" means an electric, galvanic or magnetic telegraph, and includes appliances and apparatus for making, transmitting or receiving telegraphic telephonic or other communications means of electricity, galvanism or magnetism. (4)"telegraph line" means a wire or wires used for the purpose of a telegraph with any casing, coating, tube or pipe enclosing the same and any appliances and apparatus con nected therewith the purpose of fixing or insulating the same. A combined reading of the relevant provisions of 151 the two Acts may be expressed thus: " 'Telegraph line" means a wire or wires used for the purpose of an appliance or apparatus for receiving telegraphic or other communications by means of electricity. If it is established to the satisfaction of the appropriate Government that any works for the generation transmission supply, or use of electrical energy injuriously affects such a telegraph line the said Government is authorized to take appropriate action under.s. 34 of the Act. It is not disputed that in the said factory a number of Universal Electric Motors are operated for the purpose of working electric drills and it is also established that the interference with the reception of messages at the Telegraph Wireless Station is, attributable to local induction from the said factory. But the, dispute between the parties centers round the question whether the said interference with the reception of messages at the said Station injuriously affects any telegraph line within the meaning of section 34 of the Act. The Telegraph Wireless Receiving Station clearly comes within the definition of "telegraph" in the Telegraph Act. The Telegraph Act was passed in 1885. "Telegraph" then meant "an electric, galvanic or magnetic telegraph and appliance, and apparatus for telegraphic, telephonic or other communications by means of electricity, galvanism or magnetism". At that time wireless telegraphy or radio had not been developed. In the year 1914,s. 3(1) of the said Act was amended and the following words were inserted after the words "apparatus for" : " 'making transmitting or receiving". With the result that, after the amendment, receiving of communications by means of electricity was included in the definition. A wireles. receiving station certainly receives communications by means of electricity, and therefore, it. is "telegraph" within the meaning of said definition. Though the., said station may be within the definition of "telegraph", the question still remains 152 whether there is a "telegraph line", for, under the definition, to be a ',,telegraph line" there shall.be a wire or wires used for the purpose of an apparatus receiving communications by means of electricity Under the heading "wireless telegraphy" in. the Encyclopedia Britannica, Vol. 28, a brief but adequate description of a wireless telegraphy is given thus "A wireless transmitter is a device for producing rapid oscillatory motion of electri city which is the origin of electric waves. Such electric waves are detected at a wireless receiving station b 'the effects of the rapidly varying electric and magnetic forces Which constitute the electric wave motion. " Are any wires used for the purpose of the apparatus receiving the said communications ? In the Encyclopedia Britannica some of the receiving stations ate described and 'it shows that wires are invariably used as aerials for receiving the said communications. In the present case , the Senior Electric Inspector filed an affidavit wherein he stated "it was established to my satisfaction that the operation and use of the 'Universal drills during the working hours of the factory caused serious interference by induction to the existing lines as well as to the receiving apparatus containing wires which are/were expressly used for telegraphic communication at the said centre. " It is there fore manifest that wires are used for the purpose of the apparatus receiving communications that is, wires are used not only for the aerial but &ISO inside the apparatus. A 'wireless transmitter transmits sound as electromagnetic waves and the said waves are detected by the. aerial and fed into the receiving apparatus by wires. To put it shortly the wires of the aerial as well as of the apparatus are used for the purpose of the apparatus receiving communications. If so, it follows Chit the receiving 153 appartus employs "telegraph lines" within the meaning of section 3(4) of the Telegraph Act. The High Court gave two reasons for rejecting the appellants ' contention. The first reason is that the word line ' in the expression 'telegraph line ' connotes the existence of a defined channel of communication which has got a physical existence and that wireless telegraphy is dependent upon transmission through space of electric waves and that is not a defined physical channel. We cannot accept this reasoning, for a telegraph line is not defined to mean a defined continuous physical channel from the point of transmission to the point of reception. The definition, as we have pointed out, is comprehensive enough to take in any wire used for the purpose of an apparatus for receiving communications by means of electricity. The second reason given by the learned Judges is that the expression " 'telegraph line", as used in section 34(2)(b) of the , has, in the absence of any new definition in that Act., to be given the same sense as the Legislature had intended in 1885 by the definition of that expression in the earlier Act. This reason is based upon the maxim contemporanea expositio est optima et fortissima in lege (contemporaneous exposition is the best and strongest in law). To state it differently, in the year 1885 the Legislature could not have dreamt of the future discovery of wireless telegraphy and, therefore, could not have intended to use the expression "telegraph line" in a comprehensive sense so as to take in electric wires of a receiving station of wireless telegraphy. It is necessary to consider the scope of the said maxim in its application to the interpretation of modem statutes. In Craies on Statute Law, 5th edn., the said rule is explained in the words of Coke thus at p. 77. 154 "This and the like were the forms of ancient Acts and graunts, and,, the. ancient Acts and graunts must. be ' 'construed and taken as the law was holden at that time when they were, made.", The discussion ended with the following words at p. 79 "In Assheton Smith vs Owen(1), Cozens Hardy, L. J. said do not think that the doctrine of contenporanea exposition can be applied in construing Acts which are, comparatively modern and the Court declined to apply the rule 1 to the interpretation of local Acts of 1793 and 1800. " In Halsbury 's Laws of England, 2nd edn., Vol., 32, it is stated in the context of telegraph legislation thus at p. 4 The fact that new methods of telegraphy have been invented since the date of passing of the Acts containing the definition does not prevent the application of the Acts to such methods, provided that they answer the requirements and fall within the terms of the definition." In Sutherland 's Statutory Construction, 3rd. edn., Vol. 2, dealing with the said maxim, the learned author states at p. 508 as follows "As a general rule it may be stated that legislative intent should be determined as of the time the legislation goes into effect. But surrounding circumstances and situations occurring after the enactment of the statute may be of great or even conclusive assistance in determining a meaning which was intended to be conveyed. Legislative standards are generally couched ill terms which have, considerable breadth. Therefore a. status may be interpreted to include. , circumstances or (1) , 213. 155 situations which were unknown or did not exist at the time of the enactment of the statute. " Decided cases accepted the said liberal approach in construing modern statutes. In The Attorney General vs The Edison Telephone Company of London (1),a telephone was held to be a "telegraph" within the meaning of the Telegraphs Acts, 1863 and 1869, although the telephone was not invented or contemplated in 1869. Stephen, T., observed at p. 254 : "Of course no one supposes that the legislature intended to refer specifically to telephones many years before they were invented, but it is highly probable that they would, and it seems to us clear that they actually did, use language embracing future discoveries as to the use of electricity for the purpose of conveying intelligence." The Privy Council in re Regulation and Control of Radio Communication in Canada ( 2) held that broadcasting fell within the m eaning of the expression in s.92 of British North America Act,1867, though at the time when that Act was made broadcasting was not in vogue. In The King V. Brislan ; ex parte Williams(3) the question was whether a law of the Commonwealth Parliament with respect to radio broadcasting was one with respect to "Postal, telegraphic telephonic and other like services" under section 1(5) of the Australian Commonwealth Act, and the Court held that the words were wide enough to take in radio broadcasting. In James vs Commonwealth of Australia(4),Lord Wright has state the principle in felicitous language thus (1) (2) (3) ; (4) , 641. 156 ". the meaning of the words changes, but the changing circumstances illustrate and illuminate the full import of that meaning. " This Court in construing the words "sale of goods" in Entry 48, List II of the Seventh Schedule to the Government of India Act, 1935, accepted the aforesaid principle in The State of Madras V. Gannon Dunkerley and Co., (Madras) Ltd. (1),and restated it at p. 416 thus "The principle of these decisions. is that when, after the enactment of a legislation, new facts and situations arise which could not have been in its contemplation, the statutory provisions could properly be applied to them if the words thereof are in a broad sense capable of containing them." The legal position may be summarized thus: The maxim contemporanea expositio as laid down by Coke was applied to construing ancient statutes but not to interpreting Acts which are comparatively modern. There is a good reason for this change in the mode of interpretation. The fundamental rule of construction is the same whether the Court is asked to construe a provision of an ancient statute or that of a modern one, namely, what is the expressed intention of the Legislature. It is perhaps difficult to attribute to a legislative body functioning in static society that its intention was couched in terms of considerable breadth so as to take within its sweep the future developments comprehended by the phraseology used. It is more reasonable to confine its intention only to the circumstances obtaining at the time the law was made. But in a modem progressive society it would be unreasonable to confine the intention of a Legislature to the meaning attributable to the word used at the time the law was made, for a modern Legislature making laws to govern a society which is fast moving must be presumed to be aware (1) ; 157 of an enlarged meaning the same concept might attract with the march of time and with the revolutionary changes brought about in social, economic, political and scientific and other fields of human. activity. Indeed, unless a contrary intention appears, an interpretation should be given to the words used to take in new facts and situations, if the words are capable of comprehending them. We cannot, therefore, agree with the learned Judges of the High Court that the maxim contemporanea expositio could be invoked in construing the word "telegraph line" in the Act. For the said reasons, we hold that the expression " 'telegraph line" is sufficiently comprehensive to take in the wires used for the purpose of the apparatus of the Post and Telegraph Wireless Station. In the result, we set aside the order of the High Court and dismiss the petition filed by the first respondent. The appeal is allowed, but, in the circumstances of the case, without costs. Appeal allowed.

Severe electrical interference was observed in a Post and Telegraphs Wireless Station which was traced to the respondent No. 1 's factory where a number of motors, were operated for the purpose of working electric drills. The Senior Electric Inspector issued a notice to the first res pondent to show cause as to why an order under s.34(2) (b) of the Indian Electricity Act requiring discontinuance of the operation of the electric motors in the said factory should not be made. The first respondent challenged the said order by a writ petition contending inter alia that there was no "Telegraph Line" in the Posts and Telegraphs Wireless Station within the meaning of s.34(2)(b) of the Act. The High Court held, firstly, that the word 'line ' in the expression telegraph line ' connotes the existence of a defined channel of communication which has got a physical existence and that wireless telegraphy is dependent upon transmission through space of electric waves and that is not a defined physical channel. Secondly, the expression "telegraph line", as used in section 34 2)(b) of the Indian Elec tricity Act, has, in the absence of any new definition in that Act, to be given the same sense as the Legislature had intended in 1885 by the definition of that expression in the earlier Act. This reason is based upon the maxim contemporaries exposition west optima et fortissima in lege (contemporaneous exposition is the best and strongest in law). The appellants contended that the definition of "telegraph line" in the , was wide enough to take in electric lines used for the purpose of 147 wireless telegraph and the High Court went wrong in invoking the old maxim contemporanea expositio est optima et fortisima in lege in construing the provisions of a modern statute. Held, that the combined reading of the relevant, provisions of the , and the , a "Telegraph line" is comprehensive enough and means a wire or wires used for the purpose of an appliance or apparatus for receiving telegraphic or other communications by means of electricity, and it need not be a continuous physical channel from the point of transmission to the point of reception. A wireless transmitter transmits sound as electro magnetic waves and the said waves are detected by the aerial and fed into the receiving apparatus by wires. So the wires of the aerials well as of the apparatus are used for the purpose of the apparatus receiving communications. Thus, the receivingapparatus employs "telegraph lines" within the meaning ofs.3 (4) of the Telegraph Act, 1885. Held, further, that the maxim contemporanea expositio as laid down by Coke was applied to construing ancient statutes, but not to interpreting Acts which were comparatively modem: The fundamental rule of construction is the same whether the court is asked to construe a provision of an ancient statute or that of a modern one, namely what is the expressed, intention of the Legislature. In a modern progressive society it would be unreasonable to confine the intention of a Legislature to the meaning attributable to the word used at the time the law was made, and unless a contrary intention appeared, an interpretation should be given to the words used to take in new facts and situations, if the words are capable of comprehending them. The maxim "contemporanea expositio" could not be invoked in construing the word "telegraph line" in the . Assheton Smith vs Owen, (1906)1 Ch. 179, Attorney General vs Edison Telephone Co. of London, (1880)6 Q. B. D. 244 In re Regulation and Control of Radio Communication in Canada, , The King vs Brislan,. Ex parte Williams, ; and James vs Commonwealth ,of Austratia, , referred to. State of Madras vs Gannon Dunkerley & Go. (Madras) Ltd. ; , relied on., 148

Appeals Nos. 474 to 501, 503 to 505, 508 to 512, 514 and 515 of 1959. Appeals from the judgment and orders dated November, 28, 1956, in O. J. C. No. 213 of 1955 and dated December 4, 1956, of the Orissa High Court in O. J. C. Nos. 214 to 216, 218, 236 to 241, 244 to 248, 251, 261 to 264, 268, 269, 271, 279 to 282, 304 to 306, 318, 323, 324, 353, 357, 363 and 372 of 1955. A. V. Viswanatha Sastri and M. section K. Sastri, for the appellants (in C. As. 474 487, 489 501 503 505 and 508 510 of 1959). M. section K. Sastri, for the appellant ( In C. A. No. 488/1959). G. C. Mathur, for the appellants (In C. As. Nos. ,111, 512, 514 and 515 of 1959.) C. K. Daphtary, Solicitor General of India B. R. L. Iyengar and P.M. Sen, for the respondents. August 22. The Judgment of the Court was delivered by HIDAYATULLAH, J. These are 38 appeals against the judgment and orders of the High Court of Orissa dated November 28, 1956, by which 42 petitions under article 226 of the Constitution filed by the present appellants and some others were dismissed. The High Court certified the cases as fit for appeal to this Court under article 132(1) of the Constitution. The appellants are holders of pre settlement minor inams in the State of Orissa. Their grants art, different both in regard to the time when they were made and the lands involved in them. They were made for performance of services of deities and were classed as Devadayam grants in the revenue papers. The grants in all these cases were not of whole villages but of certain lands and hence their classification as minor inams, and they comprised both the melwaram and kudiwaram rights 252 in the lands. It is not necessary to refer to these cases separately, since a single argument was addressed before us involving the consideration whether Notification No.4971 XV 9154 E.A. dated July 15, 1955, issued by the Orissa State Government, and the Orissa Estates Abolition Act, 1951 (Act 1 of 1952) as amended by the Orissa Estate Abolition (Amendment) Act, 1954 (Act XXVII of 1954) were respectively beyond the competence of the State and the Orissa State Legislature. By the original Act, all estates of the intermediaries were abolished, and on a notification by the Government, such,estates vested in Government. By the amending, Act, the definition of ' "estate" was widened to cover even such;, minor inams, and then the impugned notification was issued. The appellant contend that the original Act and the amending Act were, jointly or severally beyond the competence ,of the State Legislature and that the notification above mentioned was void without any effect. The Bill resulting in the original Act was introduced on January 17, 1950, and the Act was passed by the Legislative Assembly September 28, 1951 It was reserved for the consideration of the president, Who gave his assent on January 23, 1952. In; the Act, before its amendment in 1954, "estate" was defined as follows "2(g) 'Estate ' means any and held by an intermediary and included under; one entry in any of the general registers of revenue paying lands and revenue free lands prepared and maintained under the law for the time being in force by the collector of district , and includes revenue free lands not entered in any register and all classes of tenures or under tenures or an inam estate or part of an estate" By the amending act of 1954 this definition was substituted by another which, read: 253 "2(g) 'Estate ' includes apart of an estate and means any land held by or vested in an intermediary and included under one entry in any revenue roll or any of the general registers of revenue paying lands and revenue free lands, prepared and maintained under the law relating to land revenue for the time be ing in force or under any rule, order, custom or usage having the force of law, and includes revenue free lands not entered in any register or revenue roll and all classes of tenures or under tenures and any jagir, inam, or muafi or other similar grant. " In the original Act as well as in the Act as amended, there was a general provision in s.2(q) which may be read here : "(q) All words and expressions used in this Act but not defined in it, shall have, with reference to any part of the State of Orissa, the same meaning as defined in the tenancy laws and rules for the time being in force and in the absence of written laws and rules, as recognised in the custom for the time being obtaining in that part of the State of Orissa. " In the original Act, a provision was inserted by s.3 of the amending Act to the following effect "3. For the purpose of removal of all doubts it is declared that such lands and such rights in relation thereto and such persons who hold such lands and such rights as were heretofore covered by the definitions of the words 'estate ' and 'Intermediary ' in the Orissa Estates Abolition Act, 1951, shall not cease "to be so covered merely on the ground that by virtue of the provisions of this Act the said definitions have been amended and widened in scope. " The meaning of the last provision is clear. It takes away nothing from the ambit of the old definition, 254 but only adds thereto, as indeed the new definition of "estate" introduced by the amending Act shows only too plainly in its terms. To complete the survey of the provisions which we way have to refer to in this judgment, we first set down the definition of "estate" as given in the Madras Estates Land Act, 1908, which was applied to Orissa. Section 3(2)(d) of that Act defined " 'estate" as: "Any inam village, of which the grant has been made, confirmed or recognised by the Government, notwithstanding that subsequent to the grant the village has been partitioned amongst the grantees or the successors in title of the grantee or grantees. " The argument in this case is based upon this definition, because in defining an estate ', whole villages which were inam were contemplated and not minor inams of lands only. We shall refer to this later. The amending Act was also reserved for the consideration of the President and was assented to by him. When the Constitution was brought into force, the Bill of the Original Act had already been introduced in the Assembly. On June 18, 1951, before the Act was passed by the Legislative Assembly, the Constitution (First Amendment) Act, 1951 bad been enacted, and article 31A inserted with retrospective operation in the Constitution. Article 31A provided: "31A.(1) Notwithstanding anything contained in article 13, no law providing for (a) The acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights. shall be deemed to be void on the ground that it is inconsistent with, or takes away or sbridges any of the rights 255 conferred by article 14, article 19 or article 31 ; Provided that where such law is a law made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the "consideration of the President, has received his assent. (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 any jagir, inam, or muafi or other similar grant. . Article 31, before it was amended, by the constitution (Fourth Amendment) Act, 1955, provided inter alia that no property shall be acquired for a public purpose unless the law provided for compensation, and either fixed the compensation or specified the principles on which the compensation was to be determined and given. (Cl.2). By cl. (3), it was provided that no law such as was referred, to in cl. (2) was to have effect unless such law having been reserved for the consideration of the President had received his assent. Clause (4) then provided : "(4) If any Bill pending at the commencement of this constitution in the Legislature of a State has, after it has been passed by such Legislature, been reserved for the consideration of the President and has received his assent, then, notwithstanding anything in this Constitution, the law so assented to shall not be called in question in any court on the ground that it contravenes the provisions of clause (2)." The combined effect of these provisions of the Constitution was that there could be no compulsory acquisition of property for public purposes, unless the law provided for payment of compensation; 256 but the law could not be called in question on this ground if it had been reserved for the consideration of the President and had been assented to by him. The assent, of the President was a condition precedent to the effectiveness of the law. By the amendment of the Constitution and the addition of article 31A., no such law was to be deemed to be void on the ground that it was inconsistent with or took away or abridged any of the rights conferred by Art.14, Art.19 or Art.31 , provided that it had been reserved for the consideration of the President and had received his assent. By the definition clause, article 31A(2)(a), the expression " 'estate" was to have the same meaning in any local area, which it or its equivalent had in the existing law relating to land tenures in force in that area but was to include among others any. "inam '. The contention of the appellants is really twofold. The first argument is that the benefit of article 31A might have been available to the original Act,. as it was a law for the compulsory acquisition of property for public purposes but? not to the amending Act, which was not such, a law but only amended a previous law by, enlarging the definition of estate". The second argument is that the word "estate" as. defined in s.2(g) before its amendment did. not apply to pre ,settlement minor inams of lands as it applied only to an "inam estate", and an "inam estate" bad the meaning which the definition of "estate" had in the, Madras Estates Land Act. , viz., only whole "inam villages". This, it is urged, follows from the provisions of s.2(q) of the Estates Abolition Act quoted earlier. The first argument is clearly untenable. It assumes that the benefit of Art.31A is only available to those laws which by themselves provide for compulsory acquisition of property for public purposes and not to laws amending such laws, the assent of the President notwithstanding. This means that the whole of the law, original and amending, must be passed again, and be reserved for the 257 consideration of the President, and must be freshly assented to by him. This is against the legislative practice in this country. It is to be presumed that the President gave his assent to the amending Act in its relation to the Act it sought to amend, and this is more so, when by the amending law the provisions of the earlier law relating to compulsory acquisition of property for public purposes were sought to be extended to new kinds of properties. In assenting to such law, the President assented to new categories of properties being brought within the operation of the existing law, and he, in effect assented to a law for the compulsory acquisition for public purposes of these new categories of property. The assent of the President to the amending Act thus brought in the protection of article 31A as a necessary consequence. The amending Act must be considered in relation to the old law which it sought to extend and the President asserted to such an extension or, in other words, to a law for the compulsory acquisition of property for public purposes. The argument that this was not an acquisition of an inam estate comprising a. *hole village and thus outside the Abolition Act. itself has no substance. No doubt, these minor inams, were not of whole villages but of lands and the grant included both the warms and there were thus no inter mediaries. But they were inams nevertheless, and the Constitution defined and `estate ' an including any inam ', and the amending Act merely followed that definition. The extended definition in the Constitution and a similar extended definition in the Act thus exclude resort to 'the general definition clause in s.2(q), of the Abolition let and the definition of "estate" in the Madras, Estates Land Act. The definition of estate" introduced by the amending Act is sufficiently wide to cover such minor inams, and section 2(q) only applies, if a word or expression used in the Abolition Act is not defined therein. 258 If the minor inams are already within the definition of the word "estate", there is no need to go to s.2(q) or to any local law defining the word. There can be no doubt that if the new definition of "estate" applies to minor inams then they are affected by the Abolition Act. This, indeed, was conceded. Learned counsel for the appellants also urged, through somewhat faintly, that the ejusdem generis rule should be applied to the definition of ",estate" in article 31A(2)(a) as also to the corresponding new definition in the Abolition Act. This argument proceeds upon an assumption for which there is no foundation. The ejusdem generis rule is applicable where as wide or general term has to be cut down with reference to the genus of the particular terms which precede the general words. This rule has hardly any application where certain specific categories are 'included ' in the definition. The ejusdem generis rule may be applicable to the general. words "other similar grant", which would take their colour from the particular categories, "jagir, inam, or muafi", which precede them, but the word "inam" is not subject to the same rule. Once it is held that inams of any kind were included, it makes little difference if the inams were of lands and not of whole villages. So also the fact that the holders of such inams cannot be described as intermediaries, or that they comprised both the melwaram and the kudiwaram rights. Such a distinction would have significance, if the law abolished only intermediaries and not inams which it did. Section 3 of the Abolition Act says "3(1) The State Government may, from time to time by notification, declare that the estate specified in the notification has passed to and become vested in the State free from all encumbrances. " If the definition of the word "estate" was wide enough to include a minor inam and a notification was issued, the consequences of s.3 of the Abolition 259 Act must follow. Such a law is not capable of being called in question on the ground that it abridges any fundamental right conferred by articles 14, 19 and 31, if it has been assented to by the President. the notification was thus valid, if the law was valid. In the result, the appeals fail, and are dismissed with costs, one set only. Appeals dismissed.

The appellants were holders of pre settlement minor inams. The grants were not of whole villages but of certain lands and they comprised both the melwaram and kudiwaram rights in the lands. The definition of 'estate ' in the Orissa Estates Abolition Act, 1951, did not include a minor inam. But by the Orissa Estates Abolition (Amendment) Act, 1954, the definition was enlarged to cover minor inams also. Both the Acts had received the assent of the President. The appe llants contended (i) that the Amendment Act of 1954 was not a law for the compulsory acquisition of property for a public purpose and was not saved by article 31 A of the Constitution and (ii) that the minor inams were outside the scope of the Abolition Act and could not be resumed. Held, that the Amendment Act of 1954 was valid and was within the Protection of article 31A. In assenting to this Act, the President assented to new categories of properties being brought within the operation of the abolition Act of 1951, and he, in fact, assented to the law for the compulsory acquisition for public purpose of these new categories of property. Though the minor inams were not of whole villages and included both the warams, they were nevertheless inams" and the Constitution defined an "estate" as including "any" inam and fell within the scope of Abolition Act of 1951 as amended in 1954. The ejusdem generis rule cannot be applied to Inam in the definition of "estate" in article 31A(2)(a) because particular categories like "jagir, in am or muafi", are included in the definition expressly even though the rule may apply to "other similar grants" which expression may take its colour from the categories named. The ejusdem generis rule is applicable where a wide or general term has to be cut down with reference to the genus of the particular terms which precede the general words, 251

Appeal No. '285 of 1961. Appeal from the judgment and order dated December 6 1960, of the Gujrat High Court in Special Civil Application No. 434 of 1960. H.N. Sanyal, Additional Solicitor General of India, B. H. Dhebari, and T. M. Sen, for the appellants. I.M. Nanavati, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondents. August 21. The Judgment of the Court was delivered by DAS GUPTA, J. This appeal by special leave raises a question of the correct interpretation of some words in s.18A(1)(b) of the Industries (Development and Regulation) Act, 1951. The Central Government made an order under section 15 of that Act appointing a committee of three persons for the purpose of making full and complete investi 173 gation into the circumstances of the case as it was of opinion that there had been.or was. likely to be a, substantial fall in the volume of production in respect of cotton textiles manufactured in the industrial undertaking known as Hathisingh Manufacturing Company Ltd., Ahmedabad, for which having regard to the economic conditions prevailing there was no justification. After the committee made its report the Central Government being of opinion thereupon that this industrial undertaking was being managed in a manner highly detrimental to public interest made an order under s.18A of the Act authorising Ambalal Shah (the first appellant before us) to take over the management of the whole of the said undertaking. Against this order the industrial undertaking and its proprietor who are the two respondents before us filed a petition in the Gujarat High Court under article 226 of the Constitution praying for issue of writs directing the authorised controller and the Union of India not to take over the management on the basis of the order under s.18A. The main ground on which the application was based was that on a proper construction of s.18A(1)(b) the Central Government has the right to make an order thereunder only where the investigation made under section 15 was initiated on the basis of the opinion as mentioned in s.15(b) that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. It was also urged that in fact the committee appointed to investigate had not directed its investigation into the question whether the industrial undertaking was being managed in the manner mentioned above. The other grounds mentioned in the petition which were however ' abandoned at the time of the hearing included one that. the alleged opinion formed by the Government as mentioned in the order under s.18A was in the absence of any material for the same in the report 174 of the investigating committee and therefore ' was arbitrary, capricious and malafide. On bahalf of the Government and the authorised controller it was urged that the question which one of the five opinions mentioned ins. 15 formed the basis of the investigation under that section was wholly immaterial. The allegation that the investigating committee had not directed its investigation into the question whether the undertaking was being managed in a manner. highly detrimental to the scheduled industry concerned or to public interest was also denied. The High Court however came to the conclusion that on a correct construction of section 18A (1)(b) it was necessary before any order could be made thereunder that the investigation should have been initiated on the basis of the opinion mentioned in s.15(b) of the Act. It also accepted the petitioners ' contention that no investigation had in fact been held into the question, whether the undertaking was being managed in a manner highly detrimental to public interest. Accordingly it made an order "setting aside the order of the Central Government dated 28th July, 1960, and directing the respondents not to interfere with or take over the management of the undertaking of the first petitioner, namely "Hathisingh Mills" by virtue of or in pursuance of the said order". It is against this decision that the present appeal is directed. The principal question in appeal is whether the High Court is right in its view as regards the construction of section 18A. The relevant portion of s.18A(1) runs thus "If the Central Government is of opinion that (a) x x x x (b) an industrial undertaking in respect of which an investigation has been made under section 15 (whether or not any directions 175 have been issued to the undertaking in pursuance of section 16), is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, the Central Government may, by notified order, authorise any person or body of persons to take over the management of the whole or any part of the undertaking or to exercise in respect of the whole or any part of the under taking such functions of control as may be specified in the order. . ." The dispute is over the construction of the words "an ]investigation has been made under section 15". Section 15 is in these words "Where the Central Government is of the opinion that (a)in respect of any scheduled industry or industrial undertaking or undertakings (i)there has been, or is likely to be a substantial fall in the, volume of production in respect of any article or class of articles relatable to that industry, or manufactured, or produced in the industrial undertaking or undertakings, as the case may be, for which having regard to the economic conditions prevailing, there is no justification ; or (ii)there has been or is likely to be a marked deterioration in the quality of any article or class of articles relatable to that industry or manufactured or produced in the industrial undertaking or undertakings, as the case may be, which could have been or can be avoided; or (iii)there has been or is likely to be,, a rise in the price of an article or class of articles recitable to that industry or manufactured or produced 'in the industrial undertaking or undertakings. As the 176 case may be for which there is on justification; or (iv)it is necessary to take any such action as is provided in this Chapter for the purpose of conserving any resources of national importance which are utilized in the industry or, the industrial undertaking or undertakings, as the case may be ;or (b)any industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, the, Central Government may make or cause to be made a full and complete investigation into the circumstances of the case by such person or body of persons as it may appoint for the purpose. " It may be mentioned here that s.15(b) as it originally stood was amended in 1955 and it was after the amendment that the words as mentioned above appear. Reference may also be made in passing to s16 under which once an investigation under s.15 has been commenced or completed the central Government if it considers desirable, may issue directions to the industrial undertaking or undertakings concerned in several matters. Section 17 of the original Act was repealed in 1953 by Act 26 of 1953. The same amending Act introduced into this Act two new chapters Chapter IIIA and Chapter IIIB of which s.18A in Chapter IIIA makes provisions as set out above for an order, by the Central Government authorising any person or body of persons to take over the management of the whole or any part of the under taking. These provisions of section 18A it may be mentioned take the, place of :the. provisions that previously appeared in s.17(1). That section, now repealed, had empowered the Central Government to authorise any person, or development council or any other 177 body of person,% to take,over the management of an undertaking or to exercise with respect thereto such functions of. control as might be provided by the order, in one class of cases only viz. , where after a direction had been issued in, pursuance of section 16 the Central Government was of opinion that the directions had not been complied with and that the industrial undertaking in respect of which directions had been issued was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. The present section ISA empowers the Government to authorise any person or persons to take over the management or to excercise such functions of control as may be specified, in two classes of cases. the first of these classes is mentioned in el. (a) of s.18A(1), viz., where the Central Government, is of opinion that directions issued in pursuance of s.16 have not been complied with by an industrial undertaking. The second class with which we are here directly concerned is mentioned in el. (b) viz. , where the Central Government is of the opinion that an industrial undertaking in respect of which an investigation has been made under s.15 is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest irrespective of whether any directions had been issued in pursuance of s.16 or not. What is noticeable in the wording of this clause is that while an investigation under s.15 may be initiated in respect of an industrial undertaking where the Central Government is of any of the five opinions mentioned in s.15(a)(i), 15(a)(ii), 15(a)(iii), 15(a)(iv) and s.15(b), s.18A(1)(b) does not refer to any of these opinions( Indeed, it does not refer at all to the question of the initiation of the investigation and mentions only the making of the investigation under s.15. Read without the addition of anything more, the language of s.18 A (1) (b) empowers the Central Government.to authorise a person or persons to take over the management of an industrial undertaking 178 or to exercise specified functions of control in respect of that undertaking,if the one condition of an investigation made under s.15 has been fulfilled irrespective of on what opinion that investigation was initiated and the further condition is fufillled that the Central Government is of opinion that such undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. The contention made on behalf of the respondents before us which found favour with the High Court is that when the legislature used the words "an investigation has been made under s.15" it meant "an investigation has been made under s.15 based on an opinion of the Central Government that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. " We should have thought that if the legislature wanted to express such an intention it would not have hesitated to use the additional words mentioned above,. It was urged, however, on behalf of the respondents that these further words, viz., " 'based on an opinion of the Central Government that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest" are implicit in cl.(b) of s.18A. In his lengthy address to convince us of the correctness of this contention the learned counsel advanced in substance only two arguments. The first is that it is only where the investigation under s.15 is initiated on an opinion mentioned in s.15(b) that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interestthat the report of the investigation can furnish the government with materials on which any opinion can be formed that an industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public inter est. For this argument we can find no basis. It appears to 170 us that where the investigation has been initiated, in respect of an industrial undertaking, on an opinion that there has been or is likely to be a fall in the volume of production for which having regard to the economic conditions there is no justification s.15(a)(i) or an opinion that there has been or is likely to be a marlied deterioration in the quality of any article which could have been or can be avoided s.15(a)(ii); or an opinion that there has been or is likely to be a rise in the price of any article for which there is no justification s.15(a)(iii); or an opinion that it is necessary to take action for the purpose of conserving any resources of national importance s.15 (a)(iv), the investigation in order to be complete must also consider the quality of the management of the undertaking just as it would so consider the quality of management where the investigation is initiated on an opinion that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. For, even when the investigation has been initiated on the Government 's forming any of the opinions mentioned in the four sub clauses of el. (a) of s.15, the investigator has necessarily to examine three matters : (1) whether the opinion formed by the Government is correct; secondly, what are the causes of this state of things, viz., the unjustifiable fall in the volume of production or the deterioration in the quality of the article or the rise in the price of the articles or the necessity of an action for the purpose of conserving the resources ; and thirdly how this state of things, if it exists can be remedied. In considering the second of these matters, viz., the cause of this state of things the investigator must examine how far and in what manner the quality of management is responsible for it. He may come to the conclusion that the management is in no way responsible and that some other cause lies at the root of the difficulty. He may hold on the other hand, that the 180 management is solely responsible or he may hold that while other causes. also play their part the defect in the quality of management is. , also in part responsible. Indeed, we find it difficult to understand how an investigator having embarked on an investigation. ordered by the Government in respect of an industrial undertaking on the basis of one or more of the opinions mentioned in section 15 (a) can avoid an inquiry into the quality of the management of the industrial undertaking. It is said that the use of the words "for which having regard to the economic conditions prevailing there is no justification" in cl. (a)(i) indicate and circumscribe the scope of the enquiry and that the investigator would only try to ascertain whether or not the economic conditions are such that do or do not justify the fall in the volume of production and then to see, where necessary, how these economic conditions can be altered. To say so is however to miss the entire scheme of the legislation providing for the investigation and for action following the same. Clearly, the purpose of this legislation is to,enable the Central Government to take suitable action to remedy the undesirable state of things mentioned in the different clauses of s.15. In order that Government may have proper materials to know what action is necessary the legislature empowered the Government to make or cause to be made "a full and complete investigation". In section 18, it empowered the person or body of persons appointed to make investigation to choose one or more persons possessing special knowledge to assist in the investigation and further vested the investigating committee with all the powers of. the Civil, Court under the Code of Civil Procedure, for the purpose of taking evidence,. on oath and for, enforcing the attendance of witnesses and compelling the production of documents and, material. objects. The whole purpopse of the legislation would be frustrated unless the investigation could be "full and complete. " No 181 investigation which has not 'examined the quality of management of the industrial undertaking could be said to be full or complete. It was next contended that the use of the words "circumstances of the case" shows that the investigation had to be made only into the matter in respect of which the government has formed an opinion and not into anything else. Assuming that it is so and that the investigator has primarily to conduct his investigation where the investigation has been initiated on the basis of an opinion as regards fall in production, into questions as regards such fall ; and similarly, where the investigation has been initiated on an opinion as regards the deterioration in quality, into the question of such deterioration, that does not other the fact that the investigator would have to try to ascertain the causes of the fall in production or: the deterioration in quality and this part, of the investigation would necessarily include an investigation into the quality of the management. Learned Counsel contended that if an investigation made on the basis of one or more of the opinions mentioned in el. (a) of s.15 was sufficient to furnish the materials on which the Government could form an opinion whether or not an industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, el. (b) would by wholly unnecessary. With this we are unable to agree. There may be many cases where there may be information justifying the formation of opinion that the industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, even though,.there are no materials for an opinion that there has been or is likely to be an unjustifiable fall in production or an avoidable deterioration in quality or an unjustifiable rise in prices or the necessity of taking action for the purpose of conserving resources as 182 mentioned in the four sub clauses of cl. (a) of s.15. It was also urged that it would be unfair to expect the management, where the investigation has been initiated on the formation of an opinion as mentioned in cl. 15(a), to lead any evidence as regards the quality of its management and so there is risk of the investigator being misled. We can see no reason however for any management to have any doubt on the question that investigation would be directed among other things to the question of quality of management. We believe that one of the first things that any management would do when an investigation is initiated on the basis of any such opinion would be to try to show how efficient it was and how in spite of the high quality of,its management the misdeeds of labour or the unsympathetic attitude of Government or the difficulties of transport or some other cause beyond their control was responsible for the undesirable state of things into which the investigation was being held. The argument that except where the investigation has been initiated on the basis of an opinion mentioned in section 15(b) there would be no material for the Government to form an opinion that the industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, therefore fails. Equally untenable is the second argument advanced by the learned counsel that absurd results would follow if the words "investigation has been made under section 16" are held to include investigations based on any of the opinions mentioned in s.15(a). Asked to mention what the absurd results would be the learned counsel could only say that an order under section 18A(1)(b) would be unfair in such cases, as the owner of an industrial undertaking would have no notice that the quality of management was being investigated. That will be says 183 the learned counsel, condemning a person unheard. This argument is really based on the assumption that when the investigation has been initiated on the basis of any of the opinions mentioned in cl. (a), the quality of the management will not be investigated As we have stated earlier, there is no basis for this assumption. We have therefore come to the conclusion that the plain words used by the legislature "in respect of which an investigation has been made under section 15" cannot be cut down by the restricting phrase "based oil an opinion that the industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. " We must therefore hold that,the construction placed by the High Court on these words in s.18A(1)(b) is not correct. This brings us to the consideration of the other question raised, viz. , whether in fact the investigation had been held into. the question whether. the industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. On this question the High Court came to a conclusion adverse to the appellants. It is not clear how the respondents though abandoning the ground that Government had nonmaterial before it for forming the opinion that the undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, could still urge that no investigation had been actually held into the question whether the industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. The question whether investigation had in fact been held or not into the question whether the industrial undertaking was being managed in a Manner highly detrimental to the scheduled industry concerned or to public interest, would be relevant only to show that the Government 184 acted without any material before it or acted mala facie. If the allegation of ' mala fide or the allegation that there was no material before the Government for forming its opinion is abandoned, the question whether an investigation had in fact been held into the question whether the industrial undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, becomes irrelevant. We are satisfied however that the High Court was wrong in its view that it was not established that investigation had in fact been held into this question. We find that the assertion in the petition under article 226 that the investigation had not been directed "towards any alleged mismanagement of the mills" was denied in the affidavit sworn on behalf 'of the Union of India. When thereafter on October 10, 1960, affidavits in rejoinder filed on behalf of the petitioners affirmed 'that "no question was put which would suggest that the committee was investigating into any mismanagement of the mills," an affidavit of Mr. Thomas de Sa, who was a member of the investigating committee was, filed on behalf of the Union of India. This affidavit made the categorical assertion that the "committee" investigated not only into the question relating to the fall in the volume of production in respect of cotton textiles manufactured in the said industrial undertaking but also made a full and complete investigation into the circumstances of the working of the said industrial undertaking including the management thereof and as to whether the said undertaking was being managed in a manner detrimental to the industry concerned or to public interest. " The High Court has thought it fit to reject this testimony of Mr. De Sa for reasons which appear to us to be wholly insufficient. It appears that during the hearing the Advocate General asked for time to file an affidavit preferably of Mr. P. H. Bhuta who was. the lion official member of t he Committee of investigation but ultimately filed the 185 affidavit of Mr. De Sa and not the affidavit of ' Mr. Bhuta. The High Court seems to think that as. Mr. Bhuta was an independent member of the investigation committee while Mr. De Sa was in the service of the Government Mr. De Sa 's, statement is open to suspicion. In our view such suspicion of, high public officials is not ordinarily .,justified. , Mr. De Sa was as much a member of the investigating committee as Mr. Bhuta and so no less, competent than Mr. Bhuta to testify as regards the matter in issue. We do not think it right to suspect his honesty merely because he is an officer of the Union of India. The learned judges of the High, Court, appear also to have lost sight of, the fact that the questionnaire which annexed as annexure X to. the, affidavit of the second respondent Rajendra Prasad Manek Lal itself includes a number of questions which show unmistakably that the quality of management was being enquired into. A circumstance which appears to have weighed with the High Court is that the report of the committee which as the learned judges rightly say would be the best evidence to show "that there was in fact an investigation into the question of the management of the said undertaking" was not produced by the Union of India when called upon to do so by I. &. Nanavati on behalf of the petitioners. It is proper to mention that it does not appear that the learned judges themselves directed or desired the Advocate General to produce the report for their inspection. It further appears that no written application for the production of the docu ment was made on behalf of the petitioners. It does not seem to us to be fair to draw an inference against the Union of India merely because an informal request by the petitioners ' advocate was not acceded to. In view of what happened in the court below we asked the appellants ' counsel whether he was prepared to produce the report before us. The learned counsel readily produced the report and after examining the relevant portion 186 where the report deals with the question of management, we read it out in Court so that the respondents ' counsel could know the exact situation. This portion of the report says : ,,that the management is in the hands of a young and inexperienced person ; and the committee of the opinion that the present manager is incapable of handling the affairs of the mills ; the present managing agents are incapable of investing any further The fact that the report does contain such an opinion is sufficient to show that an investigation was actually held into the question of the quality of the management as affirmed by Mr. De Sa. The High Court 's view therefore that. no investigation was hold into the question of the management of the undertaking wag wrong. We have therefore come to the conclusion that the respondents were not entitled to any writ directing these appellants not to give effect to the, Government 's order under s 18A(1)(b). We therefore allow the appeal, set aside the order of the High Court directing the issue of the writ and order that the application under article 226 of the Constitution be dismissed. The appellants will get their costs both here and below. Apnpeal allowed.

Being of the opinion that there had been a substantial fall in the volume of production in respect of cotton textiles manufactured in the respondent company, an industrial under taking, for which having regard to the economic conditions prevailing there was no justification, the Central Government made an order under s.15 of the Industries (Development and Regulation) Act,, 1951, appointing a committee of three persons for the purpose of making a full and complete investigation into the circumstances of the case. After the committee made its report,the Central Government being of the opinion thereupon that the company was being managed in a manner highly detrimental to public interest, made an order under section 18 A of the Act authorising the first appellant to take over the management of the whole of the said undertaking. The respondents challenged the legality of the order on the ground, inter alia, that on the proper construction of s.18.A the Central Government had the right to make the order under that section on the ground 172 that the company was being managed in a manner highly detrimental to public interest only where the investigation made under s.15 was initiated on the basis of the opinion,as mentioned in section 15(b), whereas in the present case, the investigation ordered by the Central Government was initiated on the formation of an opinion as mentioned in cl. (a) (1) of section 15. Held, that the order passed by the Central Government under section 18 A was valid and that the words. used by the legislature in section 18A (1)(b) "in respect of which an investigation has been made under section 15" could not be cut down by the restricting phrase "based on an opinion that the. industrial undertaking is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest. " Section 18A (1)(b) empowers the Central Government to authorise a person to take over the management of an industrial undertaking if the one condition of an investigation made under section 15 had been fulfilled irrespective of on what opinion that investigation was initiated, and the further condition is fulfilled that 'the Central Government was of opinion that such undertaking was being managed in a manner highly detrimental to the scheduled industry concerned or to public interest.

vil Appeal No. 508 of 1957. Appeal by special leave from the judgment and decree dated June 3, 1955, of the Calcutta High Court in Appeal from Appellate Decree No. 1090 of 1949. N. C. Chatterjee and D. N. Mukherjee, for the appellant. B. C. Panda and P. K. Chaterjee, for the respondent, 882 1961. February 21. The Judgment of Kapur and Shah, JJ. was delivered by Shah, J. Hidayatullah, J. delivered a separate judgment. SHAH, J To secure repayment of Rs. 2,500/ Anath Nath Mittra hereinafter referred to as Mittra mortgaged four parcels of land to Haridas Mondalhereinafer referred to as Mondal by deed dated April 25, 1930. Mondal filed suit, No. 18 of 1937 on June 11, 1937, for enforcement of the mortgage in the Court of the 2nd Subordinate Judge, Midnapore, and obtained a preliminary mortgage decree for Rs. 5,000/and interest and costs. This decree was made absolute and in execution of the decree, the mortgaged property was sold for Rs. 4,160/ and an amount of Rs. 2,176,66 out of the decretal amount remained due and payable under the mortgage decree. Out of the four parcels of land sold, three were purchased by Mondal and the remaining was purchased by Mittra 's wife. Mondal then applied for a personal decree under 0. 34, r. 6 of the Civil Procedure Code and obtained on September 7, 1940, a decree for payment of Rs. 2,338,15,0 against Mittra. Mondal then applied for executing the personal decree by Misc. Execution Cage No. 1 1 of 1941. In the meanwhile, the Bengal Legislature enacted the Bengal Money lenders Act, 1940, which enabled the courts in certain circumstances to reopen decrees already passed. Availing himself of this Act, Mittra filed a suit under section 36 of the Bengal Money lenders Act for an order reopening the personal decree. By order dated August 16, 1941, the Subordinate Judge, Midnapore, decreed the suit and directed that a new decree for Rs. 1,431 15 0 be drawn up and that the amount due under the personal decree be paid in three annual instalments. Against this decree, an appeal was preferred to the District Court, Midnapore. The District Judge dismissed the appeal and allowed the cross objections filed by Mondal. In Second Appeal No. 1442 of 1942, the High Court of Judicature at Calcutta set aside the decree of the District Judge and restored the decree of the Subordinate Judge, 2nd Court, Midnapore. Mittra did not pay the amount as directed under the 883 new decree and Mondal applied for executing the decree. Mittra then filed another suit under section 36 of the Bengal Money lenders Act in the 2nd Court of the Subordinate Judge, Midnapore, for reopening the, decrees preliminary and final passed in the mortgage suit. The Subordinate Judge dismissed this suit as it was, in his view, barred as res judicata. In appeal to the District Court, the decree was confirmed. But the High Court in Second Appeal ordered that the preliminary and final decrees be reopened and the case be remanded to the trial court for passing a fresh preliminary decree. Against the said decree of the High Court, this appeal is filed with special leave. Section 30 of the Bengal Money lenders Act, 1940, provides in so far as it is material that notwithstanding anything contained in any law for the time being in force, or in any agreement, no borrower shall be liable to pay after the commencement of the Act a sum in respect of principal and interest which,, together with any amount already paid or included in any decree in respect of a loan exceeds twice the principal of the original loan and that the borrower shall not be liable to pay interest at rate per annum in cases of secured loans exceeding 8 per cent. simple. By section 36, the liability on loans secured or otherwise which contravenes the provisions of section 30 is liable to be reopened. It is provided by sub.s. (1) of s.36 in so far as it is material that notwithstanding anything contained in any law for the time being in force, if in any suit brought by a borrower for relief under this section whether heard ex parte or otherwise, the court has reason to believe that the exercise of one or more of the powers under the section will give relief to the borrower it shall exercise all or any of the powers specified therein as may be considered appropriate. The court is invested with the power of reopening transactions including taking of accounts between the parties, of releasing the borrower of all liability in excess of the limits specified in cls. (1) and (2) of section 30 and offsetting aside either wholly or in part or of revising or altering any security given or agreement made in respect of any loan. Exercise of these powers 884 is subject to the provisos which are not material for the purposes of this appeal. By sub section (2), the court reopening a decree is prohibited from doing anything which affects the rights acquired bona fide by any person other than the decree holder in consequence of the execution of the reopened decree; but is enjoined to order the restoration to the judgment debtor of such property, if any, of the judgment debtor acquired by the decree holder in consequence of the execution of the reopened decree as may be in the possession of the decree holder on the date on which the decree was reopened and also to order the judgment debtor to pay to the decree holder in such number of instalments as it may think fit, the whole amount of the new decree passed under cl. The court is further enjoined to direct that in default of payment of any instalments, the decree holder shall be put into possession of the property which has been restored to the judgment debtor and that the amount for which the decree holder purchased such property in execution of the reopened decree shall be set off against so much of the amount of the new decree as remained unsatisfied. Sub section (6) provides that notwithstanding any. thing contained in any law for the time being in force, the court which, in a suit to which the Act applies, passed a decree which was not fully satisfied by the first day of January, 1939, may exercise the powers conferred by sub sections (1) and (2) in any proceeding in execution of such decree. Section 36, sub section (1), contemplates the institution of a suit by a borrower for relief under that section and the court is thereby invested with the power of reopening decrees already passed. Mittra in the year 1941 filed the suit under section 36 of the Act for reopening the personal decree passed under 0. 34, r. 6 of the Civil Procedure Code. In Schedule " A " to the plaint, he set out the principal amount due under the mortgage. the interest at the rate of 8% due thereon from the date of the mortgage till the date of the suit, costs of the suit, and after giving credit for the price realised by sale of the properties, he submitted that Mondal was entitled to 885 recover only Rs. 66 13 2 and that Mondal should be declared entitled to that amount in twenty annual instalments. By a suit under section 36, Mittra undoubtedly was entitled to reopen the preliminary decree, decree absolute for sale and also the personal decree; ' but in the first suit, he gave up his right to reopen the preliminary decree and the decree absolute for sale, and was content to obtain an order that the personal decree alone be reopened. In the execution under the mortgage decree one parcel of land was purchased by Mittra 's wife and it is presumably on account of this circumstance that Mittra was unwilling to have the preliminary decree reopened. The District Judge, Midnapore, who heard the appeal against the order passed by the 2nd Court of the Subordinate Judge in the first suit under section 36 of the Act observed: " It is admitted before me by the learned pleader for the appellant that the reopening of the entire transaction will not be to the benefit of the appellant and the latter, therefore, does not want this to be done. The only relief he claims is that the new decree passed by the learned Subordinate Judge for Rs. 1,431 15 0 shall be reduced to Rs. 66 13 2 as mentioned in his application under section 36 of the Act. " In the first suit under section 36 filed by Mittra, the claim to reopen the preliminary decree and the decree absolute was deliberately abandoned and he obtained relief expressly on the footing that he did not, desire that those decrees should be reopened. Is it thereafter open to Mittra to file another suit for obtaining relief under section 36 by reopening the preliminary decree and the decree absolute ? In our judgment, section 36 contemPlates filing of one suit and not successive suits for reopening transactions including decrees and obtaining relief under the Act. If in a suit filed for that purpose, a borrower does not obtain relief which he has asked for or abandons his right to relief, in our judgment it will not thereafter be open to him to institute a second suit for relief which could have been but was not claimed in the earlier suit. The plea that in the previous suit it was not open to Mittra to make a claim for reopening the 886 preliminary decree and the decree absolute is without substance. By sub section (6) of section 36, the right to grant relief in proceedings in execution of a decree already passed but which is not satisfied is vested in. the court passing the decree and the first suit under section 36 was filed in the court which had originally passed the mortgage decree. The claim to reopen the decrees preliminary and final was abandoned not because the court was incompetent to grant relief but because Mittra did not at that stage desire to reopen those decrees. We are unable to agree with the High Court that to a suit under section 36 of the Act, the rule contained in 0. 2, r. 2 of the Code of Civil Procedure does not apply. We are also of the view that the right to claim relief which could have been but has not been asked for in the previous suit must be regarded as res judicata. In that view of the case, this appeal will be allowed and Mittra 's suit No. 105 of 1947 dismissed with costs throughout. HIDAYATULLAH, J. I have had the advantage of reading the judgment just delivered by my brother, Shah, J.; but I regret my inability to agree that the judgment under appeal be reversed. The appellant, a money lender, had advanced a sum of Rs. 2,500/ to the respondent on a simple mortgage of four properties. He filed a suit which was decreed on November 13, 1937, when a preliminary decree for Rs. 5,000/ plus costs was passed against the respondent. This decree was made final on February 25, 1938. On May 17, 1939, the four properties were sold for Rs. 4,160/ , and the balance then remaining due was Rs. 2,176/ . Three of the properties were purchased by the appellant (decree holder), and the fourth, by the wife of the mortgagor. On September 7, 1940, a personal decree for Rs. 2,338 15 3 was passed against the respondent. In 1941, execution of that decree was taken out. In the meantime, the Bengal Money lenders Act had come into force on August 1, 1940. The respondent there. upon made an application under section 36 of the Bengal Money lenders Act for reopening the decree. The 887 respondent did not say which decree he wanted reopened; but with his application he gave a statement of account of the entire amount as reduced under the Bengal Money lenders Act and by the amount realised A by sale of the four properties, and asked that a decree for the balance, Rs. 66 13 2, should be passed against him. The application was partly allowed, and afresh decree for Rs. 1,431 15 0 was passed. If the earlier decrees had been reopened, the amount due would have been Rs. 5,591 15 0, but the Subordinate Judge said : " As Rs. 4,160/ was paid, I find no necessity of cancelling the sale and ordering restitution, but for the balance of Rs. 1,431 15 0, a new decree be drawn up." The respondent appealed, and the appellant cross objected. The District Judge dismissed the appeal, allowed the cross objection, and dismissed the application. On appeal to the High Court by the present respondent, R. C. Mitter, J. allowed the appeal. He held that the personal decree was liable to be reopened, and restored the decree for Rs. 1,431 15 0 passed by the Subordinate Judge. The respondent who was directed to pay the amount by instalments under the orders of Mitter, J. made default in payment, and a money execution case was ,started against him. He, thereupon, brought a suit under section 36 of the Bengal Money lenders Act for reopening the preliminary, final and personal decrees. This suit was dismissed as barred by constructive res judicata and the principle of 0. 2, r. 2 of the Code of Civil Procedure, by the Subordinate Judge, and the appeal to the District Judge also failed. On further appeal to the High Court, K. C. Das Gupta, J. (as he then was) and Guha, J. allowed the appeal. The learned Judges held that 0. 2, r. 2 of the Code of Civil Procedure did not apply to the suit, because it refers to a previous suit and not to an application filed in execution for relief They also pointed out that under the Bengal Money lenders Act the duty was laid upon the Court to reopen any decree, if it was likely to give relief to the borrower, and that the relief did not 888 depend upon the desire or claim of the borrower. They further pointed out that even Mitter, J. was of the opinion that the relief to be given was incumbent ,,,upon the Court and independent of the wishes of the borrower. In the appeal before us filed with special leave, Mr. N. C. Chatterjee contended that the suit was barred by res judicata, waiver and estoppel, and that the Divisional Bench of the High Court was in error in ordering the reopening of the three decrees, when the respondent himself had not asked on the earlier occasion that they be reopened. The scheme of the Bengal Money lenders Act is as follows: The Act, though passed to control moneylenders and to regulate and control money lending, gave relief to borrowers in many ways. One such way was to put the limit of what is popularly known as Damdupat on interest, and another was to limit the rate of interest to 8 per cent. simple in the case of secured loans. By section 36, transactions which contravened these provisions were required to be reopened. This reopen ing was not limited to transactions, but decrees also were required to be reopened, unless fully satisfied by the first day of January, 1939. The section gave vast powers to Courts reopening decrees. Sub section (2) of section 36 provided: " (2) If in exercise of the powers conferred by sub section (1) the Court reopens a decree, the Court (a) shall, after affording the parties an opportunity of being heard, pass a new decree in accordance with the provisions of this Act, and may award to the decree holder such costs in respect of the re. opened decree as it thinks fit, (b) shall not do anything which affects any right acquired bona fide by any person, other than the decree holder, in consequence of the execution of the reopened decree, (c) shall order the restoration to the judgment debtor of such property, if any, of the judgmentdebtor acquired by the decree holder in consequence of the execution of the reopened decree as may be in 889 the possession of the decree holder on the date on which the decree was reopened, (d) shall order the judgment debtor to pay to the decree holder, in such number of instalments as it A may think fit, the whole amount of the new decree passed under clause (a), and (e) shall direct that, in default of the payment of any instalment ordered under clause (d), the decree holder shall be put into possession of the property referred to in clause (c) and that the amount for which the decree holder purchased such property in execution of the reopened decree shall be set off against so much of the amount of the new decree as remains unsatisfied. " The stages at which decrees could be reopened were laid down by sub sections (1) and (6) of section 36. Sub section (1) provided : " Notwithstanding anything contained in any law for the time being in force, if in any suit to which this Act applies, or in any suit brought by a borrower for relief under this section whether heard ex parte or otherwise, the Court has reason to believe that the exercise of one or more of the powers under this section will give relief to the borrower, it shall exercise all or any of the following powers as it may consider appropriate. " Sub section (6) provided: " Notwithstanding anything contained in any law for the time being in force, (a) the Court which, in a suit to which this Act applies passed a decree which was not fully satisfied by the first day of January, 1939, may exercise the powers conferred by sub sections (1) and (2) (i) in any proceedings in execution of such decree, or (ii) on an application for review of such decree made within one year of the date of commencement of this Act, and the provisions of rules 2 and 5 of Order XLVII of the First Schedule to the Code of Civil Procedure, 1908, shall not apply to any such application; 890 (b) any Court before which an appeal is pending in respect of a decree referred to in clause (a) may either itself exercise the like powers as may be exercised under sub sections (1) and (2), or refer the case to the Court which passed the decree directing such Court to exercise such powers, and such Court shall after exercise thereof return the record with the additional evidence, if any, taken by it and its findings and the reasons therefore to the Appellate Court and thereupon the provisions of rule 26 of Order XLI of the First Schedule to the Code of Civil Procedure, 1908, shall apply. " The words "suit to which this Act applies" were defined to mean: " 2 (22). any suit or proceeding instituted or filed on or after the 1st day of January, 1939, or pending on that date and includes a proceeding in execution (a). for the recovery of a loan advanced before or after the commencement of this Act; (b) for the enforcement of any agreement entered into before or after the commencement of this Act, whether by way of settlement of account or other:wise, or of any security so taken, in respect of any loan advanced whether before or after the commencement of this Act; or (c) for the redemption of any security given before or after the commencement of this Act in respect of any loan advanced whether before or after the commencement of this Act. " By section 2(21), " suit " included an appeal. The definition was still further widened for purposes of section 36 vide sub section (3) but nothing turns on it. The effect of these provisions may be summed up: The reopening of transactions and decrees could be achieved: (a)in any suit to which the Act applied; (b) in a suit brought by the borrower for relief under section 36; (c) in any proceeding in execution of decrees;,: (d) by an application for review of a decree made within one year of the date of commencement of the Act; and 891 (e) by appellate Courts at all the above stages. Once the Court was moved, the action of the Court was dictated by the Act, and the Court was compelled by the Act to give full relief. The Court in this case, was required by law to reopen all the decrees passed against the respondent. Indeed, R. C. Mitter, J. quite correctly pointed out: " In this case the judgment debtor was entitled to have all the decrees, namely, the preliminary, final and the personal decrees reopened. He should not have been refused relief simply because he had asked for the reopening of the personal decree only if there had been a contravention of the provisions of section 30 of the Bengal Money lenders Act. " The learned Judge, however, declined to remand the case for the application of the Act or even to apply it himself, because he felt that what was asked for by the respondent should at,least have been granted, and he granted only that relief. The law, however, gave no such option. It was mandatory, and laid a duty upon the Court. The respondent then filed a suit, and asked for all the reliefs which the Court had to award, and there can be no doubt that unless the suit be incompetent, the Act must be applied even now, because the volition of the borrower is entirely out of place in the application of the Act. The respondent no doubt, when he applied on the previous occasion, asked that the Act be applied only so far as benefited him; but his wishes were irrelevant, and the Act had to be applied, as it stood. Every one who has dealt with this case has felt this to be the true position in law. Thus, the question is whether the respondent was precluded from bringing the suit. The suit could be barred under section 11 or 0. 2, r. 2 of the Code of Civil Procedure, or by the application of the principle of constructive res judicata, or because of waiver, estoppel or the equitable principle of approbation and reprobation. The opening words of Sub section (1) and again of sub=s. (6) of section 36 are: " Notwithstanding anything contained in any law for the time being in force 892 and they are apt to put out of consideration both section 11 and O. 2, r. 2 of the Code of Civil Procedure. Waiver and the equitable doctrine of approbation and reprobation can apply only if a right were give up. They can have no application where the question is not so much of a right of a party as of the duty of a Court under the Act. The Court was moved, and had to do its duty. If it can be moved a second time by another proceeding, neither those principles nor the principle of constructive res judicata can apply. The remedies which are enjoined by the Act are not exclusive of one another, either expressly or by necessary intendment. As the law stands, the Court could take action to enforce it at almost any stage of the proceedings between the parties commenced by the creditor, and, in addition, in proceedings or a suit commenced by the borrower. The intention of the law is clear and manifest that borrowers must be protected. Indeed, in Jadunath Roy vs Kshitish Chandra Achariya Choudhury (1), the Judicial Committee held that the preliminary, the final and the personal decrees in a suit to enforce a simple mortgage were all connected and were, in effect, one decree only, and there could be no question of reopening one decree and not the others. And in Joy Chand Lal Babu vs Kamalaksha Choudhury (2), a consent decree in a mortgage suit,,, which combined the preliminary, the final and the personal decrees into one decree, was held to, be properly reopened. The decrees passed against the respondent were required by law to be reopened, and no provision of the Code of Civil Procedure or of equity could bar the suit. The first was excluded expressly, and equity was hardly applicable in view of the law on the subject. Indeed, by the suit even the.decree, of Mitter, J. could be reopened, if it did not comply. with the law. In my opinion, the order of the Divisional Bench of the Calcutta High Court, with respect, is correct and to hold otherwise is to decline to give effect to the protection, which the Act has sedulously erected in (1) (1949) L.R. 76 I.A. 179, (2) (1949) L.R. 76 I.A. 131. 893 favour of borrowers and against rapacious moneylenders. I find myself in such complete agreement with the judgment impugned, that I do not find it necessary to cover the same ground. I would, therefore, dismiss the appeal with 'Costs. BY COURT. In view of the majority judgment of the Court, this appeal will be allowed and Mittra 's Suit No. 105 of 1947 dismissed with costs throughout.

The appellant obtained a preliminary and then a final mort gage decree against the respondent and thereafter a personal decree for the debt remaining due to him 'after sale of the property mortgaged. The appellant applied for execution of the personal decree and thereupon the respondent sued for relief under section 36 of the Bengal Money lenders Act, 1940, by reopening the personal decree. In the suit relief for reopening the preliminary decree and final decree was not claimed. The personal decree was reopened in that suit and an instalment decree for a smaller amount passed instead, which was ultimately upheld by the High Court. The respondent failed to pay the instalments and the appellant applied for executing the decree. The respondent then filed another suit under section 36 of the Act for reopening the preliminary and final decrees. The Subordinate judge dismissed the suit holding that it wag barred as res judicata and the District judge on appeal affirmed that decision. But the 881 High Court in second appeal reversed those decisions and directed the preliminary and the final decrees be reopened and remanded the case to the trial court for passing a fresh preliminary decree. Hence this appeal with special leave. Held (per Kapur and Shah, JJ.), that section 36 of the Bengal Money lenders Act, 1940, contemplated the filing of one and not successive suits for the reopening of transactions including decrees and obtaining relief under the Act. If in such a suit, the borrower failed to seek the entire relief he was entitled to and abandoned his right to a part of the relief, he would be precluded from seeking that relief in another suit. The principle underlying r. 2 of 0. 2 of the Code of Civil Procedure as also the principle of res judicata applied to a suit under section 36 of the Act. Per Hidayatullah, J. When the respondent moved the executing court under section 36 of the Act he had not filed a suit but only an application. It was the duty of the court thereunder to give him full relief although he might not have asked for it. If the court failed in its duty and he filed a suit no question of waiver or constructive res judicata could at all arise. This was made clear by the non obstante words of sub sections (1) and (6) Of section 36 and the question that arose under the section was not s? much of the right of a party as of the duty of the court to give entire relief under the Act. The remedies enjoined by the Act were not exclusive of one another, either expressly or by necessary intendment, and were intended to give the widest possible relief to the borrowers. jadhunath Roy vs Kshitish Chandra Achariya Choudhury (1949) L.R. 76 I.A. I79 and joy Chand Lal Babu vs Kamalaksha Choudhury, (1949) L.R. 76 I.A. 131, referred to. Since the Act required that the decrees passed against the respondent had to be reopened, no provision of the Code of Civil Procedure or of equity could bar the suit, the former being expressly excluded and the latter made inapplicable by the substantive provisions of the Act.

11 7 of 1958. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. R.K. Garg, M. K. Ramamurthi section C. Agarwala and D. P. Singh, for the petitioners. The respondent did not appear. 306 1961 August 29. The Judgment of the Court was delivered by S.K. DAs, J. This is a writ petition oil behalf of the Bihar State Mukhtars ' Association, Patna and the Vice President and the General Secretary thereof. The petition has been heard exparte as there, has been no appearance on behalf of the Chief Justice and Judges of the Patna High Court who were cited as respondents to the petition. The petitioners contend that certain rules of the Patna High Court made as far back as 1922 under s.11 of the (Act XVIII of ' 1879), hereinafter referred to as the Act, in respect of the functions. , powers and duties of Mukhtars practising in the subordinate courts are now invalid and void, because they contravene the fundamental right of the petitioners guaranteed under article 19(1)(g) of the Constitution of India and are not saved by cl. (6) thereof. The petitioners have, in particular, challenged the validity of r. 2 made by the said High Court under section 11 of the Act and incorporated in Chapter III, Part VII of the General Rules and Circular Orders of the High Court of Judicature at Patna (Civil), 1922. The petitioners pray that an appropriate writ, direction or order be issued by this Court declaring that r. 2 aforesaid is unconstitutional and there fore, void and inoperative. We shall presently read the rule ; but before we do so a few facts which are not in dispute may be stated. The petitioners state that the Bihar State Mukhtars ' Association was formed some 30 years back with the object of generally protecting the interests of the Mukhtars in the State of Bihar practising in the courts subordinate to the High Court of Patna within the meaning of section 3 of the Act. At its various annual conferences the said Association passed resolutions to move the high Court for the removal of the restriction imposed by r. 2 aforesaid on the right of Mukhtars practising in 307 subordinate civil courts. The High Court did not remove the restriction. On July 27, 1958 at an emergent Executive Committee meeting of the Association it was. resolved to move ' the Supreme Court under article 32 of the Constitution. The present writ petition has been filed in pursuance of that resolution. The enrolment of Mukhtars is made under certain provisions of the Act to which a reference must now be made Under s.3 of the Act "a subordinate Court" means all courts subordinate to the High Court including courts of Small Causes established under Act IX of 1850 or Act XI of 1865. "Legal practitioner" means an advocate, vakil or attorney of any High Court, a pleader, Mukhtar or revenue agent. Section 6 of the Act empowers the High Court to make from time to time rules consistent with the Act in respect of certain matters including inter alia the qualifications, admission and certificates of proper persons to be Mukhtars of the subordinate courts. It appears that by a rule made under section 6 of the Act, the High Court of Patna laid down that any person who shall produce a certificate from a committee constituted by the High Court that he has passed an examination in the subjects prescribed from time to time by the High Court for the mukhtarship examination may be admitted. as a Mukhtar to practise in courts subordinate to the High Court. Rule 10 laid down the subjects in which the examination was to be held. This examination was known as the Mukhtarship examination. It was abolished some time in the year 1947 48. Under section 7 of the Act the High Court made certain rules for the grant of certificates to Mukhtars who had passed the necessary examination for admission as prescribed by the rules referred to above. Section 7 also provided for annual renewal of such certificates. The argument of learned advocate for the petitioners is rested. mainly on the pro. visions of section 9 and they must be quoted in full, 308 "Every mukhtar holding a certificate issued under section 7 may apply to be enrolled in any Civil or Criminal Court mentioned therein and situate within the same limits ; and, subject to such rules as the High Court may from time to time make in this behalf, the presiding Judge shall enroll him accordingly; and thereupon he may practise as a mukhtar in any such Civil Court and any Court subordinate thereto, and may (subject to the provisions of the Code of Criminal Procedure) appear, plead and act in any such Criminal Court and any Court subordinate thereto. " Section 10 says in effect that except as provided by the Act or any other enactment t for the time being in force, no person shall practise as a Mukhtar in any Court unless he holds a certificate issued under s.7 and has been enrolled in such court or in some court to which it is subordinate. Then come,% section 1 1 under which the impugned rule was made. This section is in these terms. "Notwithstanding anything contained in the Code of civil Procedure, the High Court may, from time time, make rules declaring what shall be deemed to be the functions, powers and duties of Mukhtars practising in the subordinate courts and, in the case of a High Court not established by Royal Charter, in such Court. " The High Court of Patna made a number of rules defining the functions, powers and duties of Mukhtars practising in the subordinate courts. One of these rules is r. 2 which is 'in these terms. "Rule 2: A Mukhtar shall not be allowed to address any Civil Court except for the purpose of stating the nature , and. effect of his application or to offer any legal argument or to examine any witness without the leave of the Court specially given. " 309 The argument of learned Advocate for the petitioners is 'this. He has submitted that s.9 of the Act gives every Mukhtar holding a certificate issued under s.7 the right to apply to be enrolled in any Civil or Criminal Court subordinate to the High Court and on enrollment in accordance with the rules , he has the right to practise as a Mukhtar in any Civil Court and in 'Courts subordinate thereto and ' has further the right to appear, plead and act in any Criminal Court. This right of practice learned Advocate for the petitioners has contended, cannot be curtailed and section 11 which empowers the High Court to Make rules declaring what shall be deemed to be the functions, powers and duties of the Mukhtars practising in the subordinate courts does not empower the High Court to make a rule which curtails the right given by s.9. His argument further is that the impugned rule curtails the right of a Mukhtar to, practise in the Civil Courts inasmuch as it says, that a Mukhtar shall not be allowed to address any Civil Court except for the purpose of stating the nature and effect of his application or to offer any legal argument or to examine any witness without the leave of the court specially given. He has contended firstly, that the rule is in excess; of the rulemaking power under section 11 and secondly, is An unreasonable restriction on the right guaranteed under article 19(1)(g) of the Constitution. The simple question for decision really is this: is the impugned rule in excess of the powers given to the High Court under section 11 of the Act ? If the rule is intra vires the Act, then clearly enough there has been no violation of any, fundamental right of the petitioners. The right of the petitioners to practise in the subordinate court a was create d by the act. In the arguments before us there was no challenge to the constitutional validity of section 11 of the Act as permitting. an unreasonable restriction of a guaranteed right, if on a proper construction that section enabled the High Court to regulate the right 310 of practice of Mukhtars. The complaint before us was that the impugned r. 2 was not justified by section 11 of the Act. Therefore, the only question which we need consider is whether the impugned rule is in excess of the authority given by section 11 of the Act. It seems to us that the impugned rule is clearly within that authority. The learned Advocate for the petitioners has. sought to make a distinction between the right to practise as given by section 9 and the functions, powers and duties as mentioned in section 1 1. Relying on the majority decision in Aswini ' Kumar Ghosh and another vs Arabinda Bose & another(1) he has submitted that the right to practise means the right to appear and plead as well as to act on, behalf of suitors in the subordinate courts; the power of the High Court to make rules under s.1 1 of the Act as respects the functions, powers and duties of Mukhtars practising in the subordinate courts merely means that the High Court may give effect to the right given under section 9 by making rules, but it cannot curtail that right ; when therefore the High Court made the impugned rule restricting the right of Mukhtars to plead in civil courts, it did something in excess of the power given by section 11. We are unable to accept this line of argument as correct. Sections 9 and 1 1 of the Act must be read together and it would be wrong to treat the right to practise given by section 9 as. dissociated from the functions, powers and duties of Mukhtars referred to in section 1 1. The learned Advocate for the petitioners is reading the two sections as though one section gives an absolute right and the other section merely empowers the making of rules to effectuate that right. That, we do not think, is a proper reading of the two sections. It is worthy of note that under section 9 itself a distinction is made between the right of a Mukhtar to practise in civil courts and his right to appear, plead and act in any criminal. court. In express terms section 9 gives every (1) ; 311 Mukhtar the right to appear, plead and act in any criminal court ; it does not, however, give such an unlimited right in a civil court. On the contrary, it merely says that on enrolment a Mukhtar may practise in any civil court, but under section 11 the High Court may make rules declaring what shall be deemed to be the functions, powers and duties of Mukhtars practising in the subordinate courts. It is clear to us that in declaring what shall be the functions and powers of mukhtars practising in the subordinate courts, the High Court can so delimit them as to regulate the right of practice. It will be wrong to treat the functions and powers as dissociated from the right to practise. The right to practise 'Must depend on the functions and powers. It is also worthy of note that the expression used in section 11 of the Act is much wider than the expression used in section 15 of the Indian Bar Council Act, 1926, (Act XXXVIII of 1926), which gives the Bar Council the power to make rules to provide for and regulate the rights and duties of Advocates of the High Court. We do not think that the majority decision in Aswini Kumar Ghosh vs Arabinda Bose (1) is of any assistance to the petitioners. That decision depended on the interpretation of section 2 of the Supreme Court Advocates (Practice in High Courts) Act, 1951. That section provided that "notwithstanding anything contained in the Bar Councils Act or any other law regulating the conditions subject to which a person not entered in the roll of Advocates of a High Court may be permitted to practise in that High Court, every Advocate of the Supreme Court shall be entitled as of right to practise in any High Court whether or not he is an Advocate of ' that High Court". It was held by the majority that a rule made by a High Court which denied to an Advocate of the Supreme Court the right to exercise an essential part of his function, by insisting oil a, dual agency on the Original Side was much more than a rule (1) 312 of practice and constituted a serious invasion of his statutory right to practise and the power of making such a rule, unless expressly reserved, was repugnant to the right conferred by section 2 aforesaid The point to be noticed is that the majority held that unless the power was expressly reserved by the statute, a rule could not be made repugnant to the right conferred by section 2 of the. Supreme Court Advocates (Practice in High Courts) Act, 1951. If it be held that sections 9 and 1 1 of the Act must be read together and functions and powers mentioned in s.11 are not dissociated from the right to practise mentioned in a. 9, then it is clear enough that section 1 1 expressly reserves the power of the High Court to make rules declaring what shall be the functions, powers and duties of Mukhtars practising in the subordinate courts. If this be the correct interpretation of sections 9 and 11 of the Act, then the principle laid down by the majority in Aswini Kumar Ghosh vs Arabinda Pose(,) is if no assistance to the petitioners in the present case. For the reasons given above, we hold that r.2 of the rules made by the High Court under section 11 of the Act is not in excess of the rule making power and the petitioners cannot complain of any violation of their fundamental right to practise the profession to which they have been enrolled under the provisions of the Act. The petition fails and is accordingly dismissed. As there has been no appearance on behalf of the respondents, there will be no order for costs. Petition dismissed.

Section 9 of the , entitles a duly enrolled Mukhtar to "Practise" in any Civil Court, and section 11 thereof empowers the High Court to make rules declaring .what shall be deemed to be the ,functions, powers and duties" of Mukhtars practising in the subordinate Courts. Rule 2 framed under section 1 1 lays down that a Mukhtar shall not be allowed to address any Civil Court except for the purpose of "stating the nature. and effect of his application or to offer any legal argument or to examine any witness" without the leave of the Court. The petitioners contended that r. 2 was in excess of the rule making power under section 1 1 and was an unreasonable restriction on their rights under article 19 (1) (g) of the Constitution. Held, that sections 9 and 1 1 of the Act must be read together and the right to "practise" given under section 9 cannot be dissociated from the "functions, powers and duties of Mukhtars" as contemplated under section 11. In declaring what shall be the functions, powers and duties of a Mukhtar the High Court may by its rules so delimit them as to regulate their right of practice in the Civil Courts, and such delimitation is no violation of their fundamental right to practise the profession as allowed under the Act. Aswini Kumar Ghosh vs Arabinda Bose, , explained and distinguished.

minal Appeal No. 240 of 1960. Appeal by special leave from the judgment and order dated November 25, 1958, of the Punjab High Court in Criminal Appeal No. 114 of 1954. Jai Gopal Sethi, C. L. Sareen and R. L. Kohli, for the appellant. N. section Bindra, R. H. Dhebar and D. Gupta, for respondent. August 30. The Judgement of the Court was delivered by SARKAR, J. The appellant Payare Lal was the Tehsildar of Patiala. He and Bishan Chand, a Patwar. clerk of the Tehsil Office, were prosecuted for offences under s.5(2) of the Prevention of 330 Corruption Act, 1947. The Criminal Law Amendment Act, 1952 (Act XLVI of 1952), to which it will be convenient hereafter to refer as the Act, required the trial to be held by a special Judge appointed under it and in accordance with certain provisions of the Code of Criminal Procedure mentioned in section 8 of the Act. The Principal question in this appeal turns on the construction of sub section (1) of this .section which we will later set out. The trial commenced before section Narinder Singh the special Judge, Patiala. He heard the evidence but before he could deliver a judgment he was transferred and was succeeded by section Jagjit Singh. section Jagjit Singh did not recall the witnesses and hear the evidence over again, but proceeded without any objection from either side, with the trial from the stage at which his predecessor had left it and having heard the arguments of the advocates for the parties, delivered his judgment convicting both the accused of the offences with which they had been charged and passed certain sentences on them. The accused appealed against their conviction to the High Court of Punjab. The appeals came to be heard by Mehar Singh J., who,, though no point had been taken by the accused, himself felt considerable difficulty as to whether section Jagjit Singh had the power to decide the case on the evidence recorded by his predecessor and referred the matter to a larger bench taking the view that if the course followed was defective, the defect would be one of jurisdiction of the Court and could not be cured by the consent of parties. The case was thereupon heard by a bench of that High, Court constituted by Gurnam Singh and Mehar Singh JJ. who took different views. Gurnam Singh J. held that section 350 of the Code applied to the trial before a special Judge in view of section 8(1) of the Act and under the terms of section 350, which we will later set out, section Jagjit Singh was entitled to proceed on the evidence recorded by his predecessor 331 section Narinder Singh, while Mehar Singh J., was of the opinion that section 8(1) of the Act did not make section 350 of that Code applicable to such a trial. He also held that what section Jagjit Singh had done was not a matter of mere irregularity curable under section 537 of the Code. The matter was then referred to Passey J., who agreed with Gurnam Singh J. On the question of section 537 of the Code, Gurnam Singh and Passey JJ. expressed no opinion in the view that they had taken of section 8(1) of the Act. The appeals were thereafter heard on the merits by Tek Chand J. who upheld the conviction of the appellant but reduced the sentence passed on him. He,, however, acquitted the other accused Bishan Chand giving him the benefit of doubt. The appellant has now come up to this Court in further appeal with special leave. There is no appeal by the State against the acquittal of Bishan Chand. There is no covntroversy that the general principle of law is that a judge or magistrate can decide a case only on evidence taken by him. Section 350 of the Code is a statutory departure from this principle. That section so far as material was at the date section Jagjit Singh decided the case in these terms : section 350. Whenever any Magistrate, after having heard and recorded the whole or any part of the evidence in an inquiry or a trial, ceases to exercise jurisdiction therein, and is succeeded by another Magistrate who has and who exercises such jurisdictions, the Magistrate so succeeding may act on the evidence so recorded by his predecessor, or partly recorded by his predecessor and partly recorded by himself or be may resumption the witnesses and recommence the inquiry or trial It is only if this provision was available to section Jagjit Singh that the course taken by him can be supported. 332 As we have said earlier, section 8 of the Act makes certain provisions of the Code applicable to the proceedings before a special Judge The question is whether section 350 of the Code. was one of such provisions. The answer to this question will depend on the construction of sub ss.(1) and (3) of section 8 of the Act the material portions of which we now set out. section 8 (1) A special judge may take cognizance of offences without the accused being committed to him. for trial, and in trying the accused persons, shall follow the procedure prescribed by the Code of Criminal Procedure, 1898 . for the trial of warrant ' cases by magistrates. (3) Save as provided in sub section (1) . . the provisions of the Code of Criminal Procedure, 1898, shall, so far as they are not inconsistent with this Act, apply to the proceedings before a special Judge ; and for the purposes of the said provisions, the Court of the special judge shall be deemed to be a Court of session trying cases without a jury or without the aid of assessors. . . . In substance these sub sections provide that a special Judge shall follow the procedure prescribed by the Code for the trial of warrant cases by magistrates and save to this extent. , the provision ,, of the Code applicable to a Court of session, shall govern him as if he were such a Court subject to certain qualifications which are not relevant for the present case. There is no controversy that section 350 of the Code is applicable only to magistrates and not a Court of session and cannot therefore be applied to a special Judge under sub section (3) as it makes only those provisions of the Code applicable to him which would apply to a Court of session. The only controversy is whether that section is applicable to a special Judge under sub s.(1) of section 8 of the Act. If it is so applicable, it must be applied 333 though under sub section (3) it is not applicable, for this sub section, is to have effect " 'Save as provided in subsection (1)". The real question is, what is meant by the words "the procedure prescribed by the Code . . . for the trial of warrant cases by magistrates" In section 8(1) of the Act ? Does section 350 of the Code prescribe one of the rules of such procedure ? It is necessary however to point out that by an amendment made in the Act after judgment had been delivered in this case by section Jagjit Singh, it has been expressly provided that section 350 of the Code applies to the proceedings before a special Judge. On the amended Act, therefore, the question that has arisen in this case, would no longer arise. For reasons to be hereafter stated, this amendment clearly does not govern the proceedings before section Jagjit Singh and this case has to be decided without reference to the amendment. Is was once held by the Madras High Court in In re, Vaidyanatha Iyer (1) that section 350 of the Code prescribed a rule of procedure for the trial of warrant cases as mentioned in section 8 (1) of the Act. This seems to be the only reported decision taking that view. All other decisions which have been brought to our notice take the contrary view. Even in Madras, in In re Fernandez (2), a Full Bench of the High Court has now hold that section 350 of the Code was not applicable to a special Judge and has overruled In re Vaidyanatha Iyer (1). That appears to be the position on the authorities. It is true that section 350 of the Code is a provision applying to all magistrates and therefore, also to a magistrate trying a warrant case. That however does not in our opinion decide the question. We think it 'relevant to observe that it is a right of an accused person that his case should be decided by a judge who has heard the whole of it and we agree with the view expressed in Fernandez 's case(2) (1) ; A.I.R. (1954) Mad. (2) 334 that very clear words would be necessary to take away such an important and well 'established right. We find no such clear words here. We turn now to the word used. When sub section (1) of section 8 of the Act talks of a procedure prescribed by the Code for the trial of warrant cases by magistrates it is reasonable to think that it has the provisions and the language of the Code in view. When we look at the Code, we find that ch. XXI is headed "of the. Trial of Warrant Cases by Magi strates". This chapter consists of sections 251 to 259. Section 251 is in these terms : section 251 In the trial of warrant cases by Magistrates, the Magistrate shall, (a) in any case instituted on a police report, follow the procedure specified in section 251A; and (b) in any other case, follow the procedure specified in the other provisions of this Chapter. The Code, therefore, expressly refers to sections 251 259 as containing the procedure specified for the trial of warrant cases by magistrates; this then,, is the procedure it prescribes for the trial of such cases. It would be legitimate, therefore, to think that the Act in using the words "procedure prescribed by the Code. for the trial of warrant cases by magistrates" also meant only these sections of the Code and did not contemplate section 350 of the Code as a procedure so prescribed, though that section is applicable to the proceedings before a magistrate trying a warrant case. It does not seem to us that the words "the procedure prescribed by the Code. . for the trial of warrant cases by magistrates" meant a procedure which may be followed by magistrates in all cases. Further more section 350 occurs in a chapter of the Code which deals with general provisions relating to inquiries and trials and is not a provision which has been specifically prescribed by the Code for application to the 335 trial of warrant cases by magistrates, as are sections 251 to 259. Again, section 350 of the Code cannot, without doing violence to the language used in it, be applied to the proceedings before a special Judge Clearly it cannot be, applied where its terms make such application impossible. Now the section can be applied only when one magistrate succeeds another. It lays down what the succeeding magistrate can do. Now suppose one special Judge succeeds another. How can he exercise the powers conferred by the section ? The section applies only when the predecessor is a magistrate. The predecessor in the case assumed is however a special Judge. Such a Judge is not a magistrate for the purpose of the Act, nor does the Act require that he is to be deemed to be such. Section 8 (1) of the Act which only requires a special Judge to follow the procedure for the trial of a warrant case, cannot justify the creation of a fiction making the predecessor special Judge, a magistrate. It is of some interest to note here that the amendment to the Act which expressly makes section 350 of the Code applicable to proceedings before a special Judge also provides that for the purposes of so applying the section, "a special Judge shall be deemed to be a magistrate". Clearly, the legislature thought that unless such a fiction was created, the application of the section to the proceedings before a special Judge would create difficulties or anomalies. Therefore also, the Act could not in our view, have intended that section 350 of the Code would be available to a special Judge as a rule, of procedure prescribed for the trial of warrant cases. For all these reasons, we would prefer the opinion expressed by Mehar Singh J. We think that under the Act, as it stood before its amendment as aforesaid, section 350 of the Code was not available when one special Judge succeeded another. 'we hold that section Jagjit Singh had no authority 336 under the law to proceed with the trial of the case from the stage at which section Narinder Singh left it. The conviction by section Jagjit Singh of the appellant cannot be supported as he had not heard the evidence in the case himself The proceedings before him were clearly incompetent. It is then said that this defect was a mere irregularity and the conviction of the appellant can, if sustainable on the evidence, be upheld under EA. 537 of the Code. In regard to this section, it was said by the Privy Council in Pulukuri Kotayyam vs King Emperor (1), "When a trial is conducted in a manner different from that prescribed by the Code (as in N. A. Subramania Iyer 's case, 1901 L.R. 28 I.A. 257), 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". It seems to us that the case falls within the first category mentioned by the Privy Council. This is not a case of irregularity but want of competency. Apart from section 350 which, as we have said, is not applicable to the present case, the, Code, does not conceive of such a trial. The trial offends the cardinal principle of law earlier stated, the acceptance of which by the Code is clearly manifest from the fact that the Code embodies an exception to that principle in section 350. Therefore, we think that section .537 of the Code has no application. It cannot be called in aid to make what was incompetent, competent. There has been no proper trial of the case and there should be one. (1) (1947) L.R. 74 I.A. 65, 75. 337 'Then it is said or,. behalf of the appellant that we should not send the case back for a fresh trial but decide it ourselves on the evidence on the record. Coming from the appellant, it is a somewhat surprising contention. According to him, a point which we have accepted, there has realy been no proper trial of the case. It would follow from this that there has to be one. In the absence of such a trial we cannot even look at the evidence on the record. Lastly, we have to say a few words on the amendment of the Act expressly making section 350 of the Code applicable to the proceedings, before a special Judge. The amendment came long after the decision of the case by section Jagjit Singh and had not expressly been made retrospective. It was said on behalf of the respondent, the prosecutor, that the amendment being 'in a procedural provision was necessarily retrospective, and, therefore, no exception can now be taken to the action taken by section Jagjit Singh. Assuming that the rule contained in section 350 of the Code is only a rule of procedure, all that would follow would be that it would be presumed to apply to all actions pending as well as future : Kimbray vs Draper (1). Such a retrospective operation does not assist the respondent 's contention. Nor do we think it an argument against sending the case back for retrial that the special Judge now hearing the case would be entitled to proceed on the evidence recorded by section Narinder Singh in view of the amendment. Whether he would be entitled to do so or not would depend on whether the amended Act would apply to proceedings commenced before the amendment. It has to be noted that the impugned part of the proceedings was concluded before the amendment. On this question, we do not propose to express any opinion. In any event, under section 350 as it now stands a succeeding magistrate (1) 338 liar, power to resummon and examine a witness further. We cannot speculate what the special Judge who tries the case afresh will think fit to do if section 350 of the Code is now applicable to the proceedings before him. For all these considerations, we think it fit to send the case back for retrial. We therefore, allow the appeal and set aside the conviction of the appellant and the sentence passed on him. The case will now go back for retrial According to law.

The appellant and another were prosecuted ' for offences under section 5(2) of the Prevention of Corruption Act, 1947. The trial commenced before the special judge who heard the evidence but before he could deliver judgment was transferred and was succeeded by another special judge. The latter did not recall the witnesses and did not hear the evidence over again, but proceeded with the trial without any objection from either side from the stage at which his predecessor had left. He convicted both the accused. On appeal, the Punjab High Court held that section 350 Criminal procedure Code applied to the trial before a special judge in view of section 8(1) of the Criminal Law Amendment Act, 1952, and the succeeding special judge was entitled to proceed on the evidence recorded by his predecessor. The controversy is whether section 330 of the Code of Criminal Procedure is applicable to a special judge under sub s.(1) ,of section 8 of the Criminal Law Amendment Act, 1952, though it is not applicable under sub section (3) of the Act. Therefore the question is what is meant by the words "The procedure prescribed by the court. for the trial of warrant cases by magistrate" in sub s.(1) of section 8 of the Act, and whether section 350 of the Code prescribe one of the rules of such procedure. The Act was since amended and therein it is expressly provided that s.350 of the Code applies to the proceedings before a special judge. The amendment does not govern the present proceeding as the impugned part of the proceedings was concluded before the amendment. Held, that the Criminal Law Amendment Act, 1952, did not intend that section 350 of the Criminal Procedure Code would be available as a rule of procedure prescribed for the trials of warrant cases, to a special judge as the special Judge was not a magistrate for the purpose of the Act not did the Act require before the amendment that he was to be deemed to be such. 329 The Act in using the words "procedure prescribed by the Code. for the trial of warrant cases by magistrate" meant only the sections 251 to 259 of the Criminal Procedure Code as expressly referred in the code as containing the procedure St specified for the trials of warrant cases by magistrate and did not contemplate section 350 of the Code as a procedure so prescribed. Held, further, that where in a case there is want of competency and not a mere irregularity, section 537 of the Code of Criminal Procedure has no application. It cannot be called in aid to make what was incompetent, competent. Held, also, that it is the right of an accused person that his case should be decided by a judge who has heard the whole of it and that very clear words would be necessary to take away such an important and well established right. In the present case the succeeding special judge had no authority under the law to proceed with the trial of the case from the stage at which hi , predecessor in office left it, and the conviction of the appellant cannot be supported as he had not heard the evidence in the case himself. The proceeding before the succeeding special judge were clearly incompetent. There has been no proper trial of the case and there should be one. In re Vaidyanatha Iyer, (1954) 1 M. I,. cable. Pulukuri Kotayya vs King Emperor, (1947) L. R. 74 I A. 65 and Kimbray vs Dapper, , referred to In re Fernandez. (1958) 11 M. L. J. 294, approved,.

No. 1 1 of 1952. Appeal from the Judgment and Order dated January 18, 1950, of the High Court of Judicature at Madras (Satyanarayana Rao and Viswanatha Sastri JJ.) in Case Referred No. 25 of 1947. O.T.G. Nambiar (Samarendra Nath Mukherjee, with him I for the appellant. M. C. Setalvad, Attorney General for India, and C. K Daphtary, Solicitor General for India (G. N. Joshi and P.A. Mehta, with them) for the respondent. December 22. The Judgment of the Court was delivered by BHAGWATI J. This is an appeal from the judgment and order of the High Court of Judicature at Madras upon a reference made by the Income tax Appellate Tribunal under section 66(1) of the Indian Incometax Act, 1922. The appellant company, the assessee, is incorporated in the United Kingdom under the English Companies Act and has it registered office in London. It owns a spinning and weaving mill at Pondicherry in French India where it manufactures yarn and cloth. Messrs. Best and Co. Ltd., Madras, have been appointed 525 the agents of the assessee under an agreement dated, the 11th July, 1939, and have been invested with full powers in connection with the business of the assessee in the matter of purchasing stock, signing bills and other negotiable instruments and receipts and settling, compounding or compromising any claim by or against the assessee. The yarn and cotton manufactured in Pondicherry were sold mostly in British India and partly outside British India. In the accounting year 1941 and 1942 all the contracts in respect of the sales in British India were entered into in British India and the deliveries were made and payments received in British India. In regard to the sales outside British India also, payments in respect of such sales were received in Madras through the said agents. The total sales of the goods in the assessment year 1942 43 were Rs. 69,69,145 and for the assessment year 1943 44 were Rs. 93,48,822. The value of the sales in British India amounted to Rs. 57,07,431 for the assessment year 1942 43 and to Rs. 67,98,356 for the assessment year 1943 44. The value of the total sales outside British India amounted to Rs. 12,61,714 for the year 1942 43 and Rs. 25,50,472 for the year 1943 44. Out of the said amounts received in respect of the foreign sales the amounts received in British India were Rs. 9,62,434 for 1942 43 and Rs. 75,230 for 1943 44 and the amounts received outside British India were Rs. 2,99,280 for 1942 43 and Rs. 24,75,242 for 1943 44. On these facts the Income tax Officer found that the assessee was resident in British India within the meaning of section 4 A (c) (b) of the Act by reason of its income arising in British India in the year of account exceeding its income arising without British India and on that basis he assessed the company for the two assessment years 1942 43 and 1943 44 as resident in British India on the profits and gains which had accrued to the company both within and without British India under section 4 (1) (b) (i) and (ii) of the Act. The order of the Income tax Officer was confirmed by the Appellate Assistant Commissioner and, the order 526 of the Appellate Assistant Commissioner was confirmed by the Appellate Tribunal on the 15th May, 1946. The assessee applied to the Appellate Tribunal under section 66 (1) of the Act for reference to the High Court of certain questions of law arising out of its order. The, Commissioner of Income tax in his reply suggested the following two questions for reference (1)Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that section 42 (1) and (3) of the Income tax Act has no application to income accruing or arising to the assessee company in British India or to income received by it in British India during the previous year?" " (2) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the entire income of the assessee company during the accounting year ended 31st December, 1941, was assessable under section 4(1) of the Incometax Act, and that no portion of such in come was entitled to be exempted under section 42(3) of the Act ? The Appellate Tribunal however referred the following questions to the High Court: " (1) Whether on the facts and in the circumstances of the case, section 42 (1) and (3) of the Act alone and not section 4 of the Act have application to the income accruing or arising to the assessee company in British India and to the income attributable to the sale proceeds received by it in British India during the previous year?" " (2) Whether on the facts and in the circumstances of this case the entire profits and gains arising to the assessee company in British India should be taken into account for the purpose of applying the test laid down under section 4 A (c) (b) or only that part of the profits which should be determined after the application of sectioin 42(3) of the Act as reasonably be attributable to that part of the operations carried on in British India ?" and " (3) Whether on the facts and in the circumstances ' of the case, the provisions. of the Indian Income tax 527 Act contained in section 4 (1) with the subsections and section 4 A (c) (b) are not ultra vires in so far as they seek to assess foreign income of the company registered outside British India ?" The third question was concluded by the decision of their Lordships of the Privy Council in the case of Wallace Bros. & Co. Ltd. (1) and was therefore not argued before the High Court and the High Court answered it by stating that the provisions of section 4 (1) and section 4 A (c) (b) of the Act were not ultra vires the Indian Legislature. The question No. (1) was further amended by agreement between the learned counsel for the revenue authority and the assessee and it was reframed as under: " (1) Whether on the facts and in the circumstances of the case section 42 (1) and (3) of the Act alone and not section 4 of the Act have application to the income accruing or arising by reason of sales in British India of manufactured goods where the manufacturing process took place outside British India?" The question (2) was retained in the form in which it had been referred by the Appellate Tribunal. Both these questions were answered against the assessee by the High Court. The assessee obtained the necessary certificate from the High Court for leave to appeal to this court and hence this appeal. It may be observed that in reply to the. notice under sections 22(2) and 38 of the Act for the assessment year 1942 43 the agents of the assessee had on the 1st June, 1943, submitted a return under protest and had claimed that the income shown in the return should be apportioned under section 42(3) of the Act as between the operations carried on in British India and operations carried on outside British India. They had further declared that the company was non resident in British India during the previous year for which the return was made. In the statement enclosed therewith the total world income for the year ended 31st December, 1941, had been shown at Rs. 10,23,907. Profit at 10 per cent. on British Indian sales which (1) (1948) 76 I.A. 86. 528 aggregated to Rs. 57,07,431 was shown at Rs. 5,70,743 and after deduction of the proportionate expenses relating to sales in British India and sundry charges was put down at the net figure of Rs. 4,58,026 which was shown as the British Indian income. It was thus contended that the income arising in British India in the year of account did not exceed its income arising without British India and that therefore the assessee was non resident in British India. This calculation of profits at the rate of 10 per cent. on British Indian sales did not make any allocation between manufacturing profits and merchanting profits and all the profits arising out of British Indian sales were shown in one lump sum. The Income tax Officer took it as settled law that the profits arose in the country in which the sales took place and as the bulk of the sales had taken place in British India the bulk of the profits accrued or arose in British India. He held that the provisions of section 42(3) would apply only where the profits arose outside British India but which by virtue of section 42(1) were deemed to accrue or arise in British India, and that it did not apply where the profits actually arose in British India by the sale of goods in British India. He therefore held that the entire profits on "Sales made in British India actually arose in British India and were liable to tax under section 4 (1) (c). On a calculation of the figures he came to the conclusion that the income of the assessee arising in British India in the accounting year exceeded its income arising without British India and that the assessee was resident in British India under section 4 A(c). The assessee was also held ordinarily resident in British India under section 4 B(c) and he assessed the company accordingly on that basis. The Appellate Assistant Commissioner also proceeded on that basis and confirmed the order of the Income tax Officer. He was however further of the opinion that the entire profits were received where the sale pro ceeds were received and the assessee was therefore. liable to tax under section 4(1)(a) also. This conclusion was arrived at by him relying upon two decisions of their Lordships of the Privy Council: (1) 529 Pondicherry Railway Company V. Commissioner of Income tax, Madras(1) and Commissioner of Income tax, Madras vs Diwan Bahadur Mathias(2), in the first of which at page 369 Lord Macmillan observed as follows : Their Lordships accordingly are of the opinion that the income derived by the Pondicherry Railway Company from the payment made to them by the South Indian Railway Company is on the facts stated received in British India within the meaning of the Act by the Agent of the Pondicherry Railway Company there on their behalf " It is unnecessary to go on to consider whether the business is carried on in British India, which is the form which question (c) takes, for it is enough if the profits of a business carried on by the assessee are received in British India and the place where the business is carried on is not material. " The Appellate Tribunal adverted to the fact that the whole income of the company, so far as 1942 43 is concerned was received in British India and so far as 1943 44 is concerned a major part of it in this way was received in British India, but did not base its decision on this aspect of the case. It held that the scope of section 42(3) was circumscribed by confinement to those cases where profits were deemed to accrue or arise under section 42 alone and there was no warrant for extending the principle of apportionment to other cases where the profits and gains were made taxable under other sections of the Act. It also held that section 42 dealt with " deemed " income whereas section 4 A (c) dealt with income that arose in British India. Therefore, it could not be said that for the purpose of section 4 A (c) a proportionate "deemed " income should be taken as income that arose in British India. When the application for reference was made to the Appellate Tribunal the Commissioner of Income tax in the question (1) which he suggested included within its ambit this aspect of the income having been received by the assessee in British India during the previous year. But when the Appellate Tribunal refrained the question (1) it merely (1) (2) [1939] 7 I.T.R 48. 530 confined it to income accruing and arising to the assessee in British India and to the income attributable to the sale proceeds received by it in British India during the previous year. The question (1) as finally framed by the High Court adverted to the income accruing or arising by reason of sales in British India on manufactured goods where manufacturing process took place outside British India and the aspect of the income having been received by the assessee in British India was absolutely ignored. When the questions were originally referred to the High Court the position in law as then understood was that profits arose in the country in which the sales took place. This position was however negatived, particularly in the case of manufacturing businesses, in a decision of this court. in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(1). After hearing at considerable length the arguments urged before us on behalf of the assessee as well as the Income tax authorities we feel that in view of that decision the questions framed by the Tribunal and the High Court do not bring out the real point in controversy between the parties and it is agreed that the following two questions truly represent I and bring out the matter on which the parties are at issue. We therefore resettle the questions originally framed and reframe them as below: (1) Whether in view of the finding of fact in this case that the entire profits were received in India and the company is liable to tax under section 4 (1) (a) of the Act, the provisions of section 42(1) have any relevancy ? (2) Can the income received in India be said to arise in India within the meaning of section 4 A(c)(b) of the Act ? If not, should only those profits determined under section 42(3) as attributable to the operations carried out in India be taken into account for applying the test laid down in section 4 A (c) (b) ? (1) ; ; 18 I.T.R. 472. 531 The case is remanded to the High Court with the direction that it should give its opinion on, these two questions and submit the case to this court within three months. section N. Mukherjee, for the appellant. Porus A. Mehta, for the respondent. December 8. BHAGWATI J. By our judgment dated the 22nd December, 1952, we reframed the questions as below: (1) Whether in view of the finding of fact, in this case that the entire profits were received in India and the company is liable to tax under section 4 (1) (a) of the Act, the provisions of section 42 (1) have any relevancy; (2) Can the income received in India be said to arise in India within the meaning of section 4A (c) (b) of the Act ? If not, should only those profits determined under section 42 (3) as attributable to the operations carried out in India be taken into account for applying the test laid down in section 4A (c) (b), and remanded the case to the High Court with the direction that it should give its opinion on these two questions. The High Court has accordingly considered these two questions which were referred to it for opinion and has answered the question No. I in the negative and against the assessee and question No. 2 in the manner following, i.e., the income received in British India cannot be said to wholly arise in India within the meaning of section 4A (c) (b) of the Act and that there should be allocation of the income between the various profit producing operations of the business of the company in the light of the principle contained in the judgments in Ahmedbhai Umarbhai 's case(1) and in Anglo French Textile Company vs Income tax Commissioner(2) relating to the same assessee. When the matter came up for further arguments before us on this opinion of the High Court,Shri section N. Mukherjee, the learned counsel for the appellant (1) (1950] 18 I.T.R. 472, (2) A.I.R, 70 532 did not contest the correctness of the answer to question No. I in view of the decision of this court in Turner Morrison & Co., Ltd. vs Commissioner of Incometax, West Bengal(1). It may be noted that even before the High Court the learned counsel appearing for both the parties agreed that the matter was concluded by this decision against the assessee and question No. I was answered accordingly by the High Court. In regard to the question No. 2 however Shri Porus A. Mehta, learned counsel for the respondent, contended before us that the matter was not concluded by the judgment of the majority in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(1) and that the High Court was wrong in the answer which it gave to this question. He contended that the decision in the case of Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay("), turned on the statutory provisions of the Excess Profits Tax Act read with section 42 (3) of the Indian Income tax Act which was expressly incorporated therein by virtue of section 21 of the Act and not on any general principles of apportion. ment of income, profits or gains enunciated therein. He took us in extensover the portions of the majority judgments and tried to demonstrate that the decision there was based purely on the applicability of section 42 (3) of the Indian Income tax Act, but for the applicability of which, according to his submission, there was no room for the apportionment of the income, profits or gains of the business, in the manner contended by the appellant. We do not accept this contention of the respondent. Section 4A(c) (b) is concerned with the income arising in the taxable territories in a particular year exceeding the income arising without the taxable territories in that year and the very words of the section are capable of being construed as also contemplating a state of affairs where there may have to be a division or apportionment between the income arising in the taxable territories and the income arising without the taxable territories (1) (2) ; 533 in the particular year. The whole of the argument urged before us on behalf of the respondent was aimed at establishing that the scheme of the Indian Income tax Act was not to tax the source of income but the income, profits or gains from whatever source derived which were received or were deemed to be received in the taxable territories or which accrued or arose or were deemed to accrue or arise in the taxable territories during the particular year and that it was immaterial whether the income, profits or gains were derived from business operations carried on in the taxable territories or without the taxable territories. This argument was possible when the decisions which held that income, profits or gains arose or accrued at the places where the sales took place were good law, because then there was no question of apportionment of income, profits or gains arising from the business operations carried on in the taxable territories 'and income, profits or gains arising from the business operations carried on without the taxable territories. The moment however it was held, as it was done in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(1), that though profits may not be realised until a manufactured article was sold profits were not wholly made by the act of sale and did not necessarily accrue at the place of sale and to the extent profits were attributable to the manufacturing operations profits accrued at the place where business operations were carried on, these decisions went by the board. The question whether a particular part of the income, profits or gains arose or accrued within the taxable territories or without the taxable territories would have to be decided having regard to the general principles as to where the income, profits or gains could be said to arise or accrue. Section 42 of the Indian Income tax Act has no relevance to the determination of this question because it is mainly concerned with income Which is deemed to have arisen, or accrued and not with income which actually arises or. accrues within the taxable Territories. Section 42 (3) also is a part of the ' scheme which is enacted in section 42 and cannot help (1) (1950)S.C.R. 335. 534 in the determination of the question before us As a matter of fact the use of the words "under section 42(3)" used in the question No. 2 as reframed by us was not appropriate and the only question which should have been sent to the High Court was "If not, should only those profits determined as attributable to the operations carried out in India be taken into account for applying the test laid down in section 4A (c) (b). " If, therefore, section 42(3) has nothing to do with the determination of the income arising in the taxable territories as distinguished from the income arising without the taxable territories as understood in section 4A(c) (b) of the Act what we have got to consider is whether there is anything in the Act which prevents the application of the general principle of apportionment of income, profits or gains between those which are derived from business operations carried on within the taxable territories and those which are derived from business operations carried on without the taxable territories. The contention which was advanced by Shri Porus A. Mehta on behalf of the respondents in this behalf, viz., that the word ,arise " was the only word used in section 4A (c) (b) and the word "accrue" did not find any place therein, that there was a distinction between the conception of arising and the conception of accrual and that the apportionment of the income was appropriate only in cases where the income arose and was inappropriate in cases where the income accrued, was sufficiently repelled in the judgment in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai &.Co., Bombay(1), where it was observed: " Whether the words 'derive ' and 'Produce ' are or are not synonymous with the words 'accrue ' or arise it can be said without hesitation that the words 'accrue ' or " arise ' though not defined in the Act are certainly synonymous and are used in the sense of 'bridging, in as a natural result '. Strictly speaking, the word 'accrue ' is not synonymous with 'arise ', the former connoting idea of growth or accumulation and the (1) ; at p. 364. 535 latter of the growth or accumulation with a tangible shape so as to be receivable. There is a distinction in the dictionary meaning of these words, but throughout the Act they seem to denote the same idea or ideas very similar and the difference only lies in this that one is more appropriate when applied to a particular case. In the case of a composite business, i.e., in the case of a person who is carrying on a number of businesses, it is always difficult to decide as to the place of the accrual of profits and their apportionment inter se. For instance, where a person carries on manufacture, sale, export and import, it is not possible to say that the place where the profits accrue to him is the place of sale. The profits received relate firstly to his business as a manufacturer, secondly to his trading operations, and thirdly to his business of import and export. Profit or loss has to be apportioned between these businesses in a businesslike manner and according to well established principles of accountancy. In such cases it will be doing no violence to the meaning of the words accrue ' or 'arise ' if the profits attributable to the manufacturing business are said to arise or accrue at the place where the manufacture is being done and the profits which arise by reason of the sale are said to arise at the place where the sales are made and the profits in respect of the import and export business are said to arise at the place where the business is conducted. This apportionment of profits between a number of businesses which are carried on by the same person at different places determines a so the place of the accrual of profits. " The phraseology of section 42(3) of the Act 'also repels the contention in so far as the profits and gains of the business which are referred to therein and which are capable of apportionment as therein mentioned are deemed to accrue or arise in the taxable territories thus using the words "accrue" and "arise" as synonymous with each other. The above passage is also sufficient in our opinion to establish that the apportionment of income, or gains between those arising from business opinion 536 carried on in the taxable territories and those arising from business operations carried on without the taxable territories is based not on the applicability of section 42(3) of the Act but on general principles of apportionment of income, profits or gains. That was really the ratio of the judgment of the majority in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay(1), and any attempt to distinguish that 'ease from the present one by having resort to the statutory provisions of the Excess Profits Tax Act is really futile. We are accordingly of the opinion that the answer given by the High Court to the question No. 2 also was correct. The appeal before us will accordingly be allowed and the answers to the questions Nos. 1 and 2 refrained by us will be as under: Question No. 1 In the negative; and Question No. 2 The income received in British India cannot be said to wholly arise in India within the meaning of section 4A (c) (b) of the Act and that there should be allocation of the income between the various business operations of the assessee company demarcating the income arising in the taxable territories in the particular year from the income arising without the taxable territories in that year for the purposes of section 4A (c) (b) of the Act. In so far as the appellant has failed in one part of the case and succeeded in another part we think that the proper order for cost should be that each party bears and pays his own costs of this appeal including ,the costs of the remand before the High Court. Appeal allowed.

The assessee, a company incorporated in the United Kingdom and having its registered office in London, manufactured yarn and cloth in their,mill at Pondicherry. The assessee had appointed another company in Madras as their agents. The manufactured goods were sold mostly in British India and partly outside British India. All the contracts in respect of the sales in British India: were entered into in British India and deliveries were made and payments were received in British India. In regard to sales outside British India also, payments were received in Madras 69 524 through the agents and it was found as a fact that, the entire profits were received in India: Held, (i) that in view of the finding of fact that the entire profits were received in India and the assessee was liable to tax under section 4 (1) (a), the provisions of section 42 (1) had no relevancy ; (ii)that the income received in British India could not be said to wholly arise in British India within the meaning of section 4A (c) (b) and that there should be allocation of the income between the various business operations of the assessee demarcating the income arising in the taxable territories in the particular year from the income arising without the taxable territories in that year for the purposes of section 4A (c) (b) of the Act. Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co. ([1950] S.C.R. 335), Pondicherry Railway Company vs Commissioner of Income tax, Madras [1931] (58 I.A. 239), Turner Morrison and Co. vs Commissioner of Income tax [1951] (19 I.T.R. 451 ; , referred to.

Appeal No. 154 of 1961. Appeal by special leave from the judgment and order dated October 31, 1960, of the National Industrial Tribunal (Bank Disputes), Bombay, in Reference No. 1 of 1960. WITH Petitions Nos. 70 80 and 82 of 1961. Petitions Under Article 32 of the Constitution of India for enforcement of Fundamental Rights. A.S. R. Chari, V. G. Raw, D. P. Singh, Al. K. Ramamurthi. R. K. Garg and section C. Agarwal, for the appellant and the petition (in Petn. No. 80 of 61). M. C. Setalvad, Attorney General of India, N. V. Phadke, K. H. Bhabha, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for respondents Nos. 2 17 and 19 34 (In appeal and Petn. No. 80 of 61). J.B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for respondents NOS. 41 49 (In appeal and Petn. 80 of 1961). Anand Prakash, for Respdts. 35 40 (In Petn. No. 80 of 61). A. V. Viswanatha Sastri, D. P. Singh, M. K. Ramamurthi, R. K. Garg and section C. Agarwal, for Intervener No. 2. D.S. Nargolkar and K. R. Choudhri, for Petitioners Nos. 70 and 82 of 61). M. C. Setalvad, Attorney General of India, C.K. Daphtary, Solicitor General of India, H.N. Sanyal Additional Solicitor General of India, J.B Dadachanji, 272 section N. Andley, Rameshwar Nath and P. L. Vohra, for Respdt No. 2 (In Petns. Nos. 70 and 82 of 61). Naunit Lal .for intervener No. 3. M. C. Setalvad Attorney General of India and T. sen, for Intervener No. 1. 1961. August 28. The Judgment of the Court was delivered by AYYANGAR, J. Civil Appeal No. 154 of 1961 has been filed on special leave obtained from this Court Against an order of K. T. Desai, J., functioning as the National Industrial Tribunal (Banks Disputes) Bombay dated October 31, 1960. The point arising for decision in the appeal is as regards the constitutional validity of section 34A of the Banking Companies Act, 1949 which was enacted on August 26, 1960 as an amendment to the parent Act (Act X of 1949). The appellant before this Court is the All India Bank Employees ' Association which is a trade union organization of Bank Employees of several banks operating in India The Punjab National Bank Employees ' Union, which is a trade union with similar objects has been committed to intervene in this appeal in support of the appellant union The three other Writ Petitions are by other Bank Employees ' Unions whose description would be apparent from the cause title and all these cases have been heard together because in the writ petitions also the point raised is identical, viz., the validity of s.34A of the Banking Companies Act, which will be referred to hereafter as the impugned provision. Section 34A whose validity is the matter in dispute in these proceedings runs in the following terms "34A. (1)Notwithstanding anything contained in section 11 of the . or any other law for the time being in force, no banking company 273 shall in any I proceeding under the said Act or in any appeal or other proceeding arising therefrom or connected therewith, be Compelled by any authority before which such proceeding is pending to produce, or give inspection of, any of its books of account or other document or furnish or disclose any statement or information, when the banking company claims, that such document, statement or information is of a confidential nature and. that: the production or inspection of such document or the furnishing or disclosure of such statement or information would involve disclosure of information relating to : (a)any reserves not shown as such in its published balance sheet ; or (b)any particulars not shown therein in respect of provisions made for bad and doubtful debts and other usual or necessary provisions. (2)If, in. any such proceeding in relation to any banking company other than the Reserve Bank of India,, any question arises as to whether any amount out of the reserves or provisions referred to in sub section (1) ,should be taken into account by the authority before which such proceeding is pending, the authority may, if it so thinks fit, refer the question to the Reserve Bank and the Reserve Bank shall after taking into account principles of sound banking and all relevant circumstances concerning the banking company, furnish to the authority a certificate stating that the authority shall not take into account any amount as such reserves and provisions of the banking company or may take them into account only to the extent of the amount specified by it in the certificate, and the certificate of the Reserve Bank on 274 such question shall be final and shall not be called in question in any such proceeding. (3)For the purposes of, this section, "banking, company" shall have the meaning assigned to it in the , Before commencing the examination of the points in controversy and the grounds on which the legality of the above provision is impugned. It would be helpful for a better appreciation of the problem if we set out in very brief outline, the history of the steps which led to the enactment in dispute ' There was a long standing practice in England of Banking Companies, as distinguished from companies carrying on other commercial etc. activities, not to disclose, in their balance sheets and Profit & Loss accounts, bad and doubtful debts and the provision made therefore, as well as, the secret reserves created and held under various items a practice which received judicial recognition by Buckley, L., J. in .Newton vs Birmingham Small Arms Co. Ltd. (1) This practice was followed by several banks in India and questions arose from time to time as to how far the practice was consistent with the statutory provisions as to disclosure contained in the several Companies Acts enacted from time to time. ; We shall, how ever, add that the desirability and; even the legality of this practice has not gone without challenge, though there has been a considerable body of opinion which has held this to be salutary and necessary for the preservation and progress of a credit institution like a bank. We are not now concerned with the desirability or ethics of the practice which is a matter for the consideration of the legislature but as to the steps by which accord was established between the practice and the law. The Indian Companies Act of 1866 drew no distinction between the contents of balance sheet,% of banking companies as distinguished from those of (1) 275 other companies and both were required to disclose a list of debts owing to the concern which were considered bad or doubtful Pro visions on the same lines, i. e., without any, distinction between Banking and other companies, were copied and continued by the Indian Companies Act of 1882. When, however, the Companies Act of 1913 was enacted, Form F ' to the 3rd Schedule to the Act contained a note in respect of the sub heading ' 'book debts ' under the head Property & Assets ' in the balance sheet, reading "distinguishing ill the case of a bank between those considered good and in respect of which the bank is fully: secured and those considered good for which the bank holds no security other than the debtor 's personal security; and distinguishing in all cases between debts considered good, and debts considered doubtful or bad. Debts due b y directors or other officers of the company or any of the either severally or joint with any other persons to be separately stated in all cases. " It would be seen that by reason of this note the obligations imposed upon banks as regards the classification of their; assets and the information to: be disclosed became slightly more detailed than in ' the case of other companies. The practice, 'however, of bankers to which we adverted earlier not to disclose or not to disclose to the full extent bad and doubtful debts but to make, provision for them by setting aside under other heads, sufficient moneys which would operate as secret reserves, so that the credit of the institution would not be affected while its financial stability would remain unimpaired; was continued notwithstanding this, change in the form. The Central Bank of India Limited in its published, balance sheets of the year 1925 adopted the above practice which however, wasn 't obviously in strict conformity with the requirements of From 'F 'to the third schedule read with note. The 276 managing director of the bank was prosecuted by one Shamdasani who was a shareholder of the bank ,or "filing and publishing statements which were false in material particulars" an offence punishable under section 282 of the Indian Companies Act. The Magistrate acquitted the accused on the ground that the balance sheet was in accordance with the usual practice of bankers and that the reserves of the company which were shown under various heads though not as a specific provision for bad and doubtful debts covered the possible losses several times. Ail application for revision was filed before the High Court of Bombay and Fawcett, J. allowed it holding that a declared provision. of the form cannot be allowed to be whittled down by general considerations as to the object of a balance sheet. " This judgment was rendered on February 28, 1927 (vide Shamdasani vs Pochkanwala (1) and very soon thereafter the Government of India intervened by a notification dated March 29, 1927 under section 151 of the companies Act 1913 amending form 'F ' and as amended banks were excluded from the requirement of disclosing the reserve for bad and doubtful debts under the heading, `capital and Liabilities ' in the left hand side of the balance sheet, and in the right hand column "book debts which were bad and doubtful for which provision had been made to the satisfaction of the auditors",, were not required to be shown as part of the property and assets of a Bank. The provisions of the Companies Act of 1913 underwent numerous changes by the amending Act of 1936 which included inter alia one whereby the change effected by the Notification, dated March 29, 1927, in Form `F ' were omitted and Form `F 'was made to retain the note which accompanied it under the Act of 1913 without the exception in favour of banks effected by the Notification. This was possibly unintended, because on the day after the amending Act came into operation, the Central Government published a Notification on January 16, 1937 (1) A.I.R. 1927 Bom. 414 : 277 again under s.151 of the Companies Act restoring the alterations in the balance sheet Form 'F ' as had been effected by the prior Notification ,of March 1927. The validity of this Notification was questioned as being beyond the powers of the Central Government by Shamdasani who filed a complain against the Central Bank of India Limited and its directors charging them with having issued a false balance sheet for the year ending December 31, 1939 a balance sheet which was in conformity with the form as modified by the Notification. The Magistrate upheld the validity of the Notification and quitted the accused. Shamdasani preferred a revision to the High Court and a full Bench of the Bombay High Court held that the Notification was beyond ' the powers of the Central Government, though the order of acquittal was affirmed upholding the plea of the accused that their act was bona fide in that they believed the alteration in the form to be valid (Vide Shamdasani vs The Central Bank of India Ltd.(", Immediately after 'this judgment the Central legislature passed Act XXX of 1943 with retrospective effect validating the Notification and amending the relevant sections of the Companies Act. (sections 132,151, article 107) so as to empower the Government to effect changes in the form of the balance sheet in the manner in which they had done in January ' 1937. The next event in order of date relevant to the present context is the report of the Company, Law Amendment Committee of the United Kingdom presided over by Mr. Justice Cohen where the entire question of undisclosed reserves was fully discussed. The pros and cons of the question were elaborately considered by the Committee and it is sufficient therefore in this connection to a short passage in the report. In paragraph 101 the problem is thus set, out : "The chief matter which has and controversy is the question of undisclosed or, a. (1) I. L. R. 278 the Are, frequently called, secret or inner reserves. An undisclosed reserve is commonly created by using profits to write down more than is necessary such assets as investments,freehold and leasehold property or plant and machinery by creating excessive provisions for bad debts or other contingencies by charging capital expenditure to revenue ; or by undervaluing stock in trade. Normally the object of creating an undisclosed reserve is to enable a company to avoid violent fluctuations in its published profits or its dividends. " The Committee made number of recommendations several of which were adopted in ' the U. K. Companies Act of 1948, and those relevant ' to the point under discussion served to bring the law as to the contents of a balance sheet of a Banking Company unto. line with the practice of sound and well managed banks. In India, special legislation in relation to Banking Companies embodying several of these recommendations was enacted in the shape of the Banking Companies Act 1949 (Act of 1949). Section 29 of the Act laid down the law in regard to requirements of the contents of the balance sheets of banks. The balance sheet and Profit & Loss account were to be in the form set out in the 3rd schedule to that and sub section (3) of that section exempted Banking Companies from the, requirements of conforming to the form of balance sheet and Profit & Loss, account of companies registered under the Indian Companies Act; and the Central Government were empowered by sub section (4) to amend the, form set out in the schedule by Notifications published in the official. , Gazette. In Form 'A ' which provided the model of a balance sheet 'and Profit & Loss account in the case of banks, there was not much change as compared to the requirements of the previous law except that in the Profit & Loss account (Form 'B ' )I the third schedule) the provision for bad and doubtful debts was permitted to be excluded from the 279 income so that the amount of bad and doubtful debts did not figure separately on the income side of the profit & loss account. The income as required to be shown was "income (less provision made during the year for bad and doubtful debts)". This last item was modified by a Notification issued under the power conferred by s.29(4) of the Act in December 1951, so that after amendment .the beading "Income" in the Profit & Loss Account ran: "Income (less provision made during the year for bad and doubtful debts and other usual and necessary provisions"). Thus so far as shareholders of Banks and the general public including the customers of the bank were concerned, banks were relieved from the obligation of disclosing the entirety of their reserves as such and also of the extent of bad or doubtful debts and the provision made therefore. While the law was in this state disputes arose between the employees of banks all over India and the respective banks with regard to wages, conditions of work etc. which were referred by the Central Government in June 1949 to an ad hoc Tribunal with Shri K. C. Sen, a retired Judge of the Bombay High Court as Chairman. The Tribunal passed an award but its validity was successfully challenged in this Court in April 1951 on the ground that all the members of the Tribunal who passed the award were not those who had all inquired into the dispute. Thereafter a fresh Tribunal was appointed in January 1952 with Shri section Panchapages Sastri, a retired Judge of the High Court of Madras as Chairman. The award of this Tribunal was published in April, 1953, but it is not necessary to state its terms. Appeals against the award were preferred to the Labour Appellate Tribunal both by the banks as well as by workmen. The Appellate Tribunal which heard the appeal consisted of three members with Shri Jeejeebhoy as president. The claim of the workers in the appeal before the Appellate Tribunal in great part related to a 280 demand for increased wages and salaries and the main defence of the banks was that they had not the capacity to pay anything beyond what the Sastry Tribunal had granted. The Jeejeebhoy Tribunal set out their difficulties in assessing the plea of incapacity raised by the banks in the context of the provisions of the Banking Companies Act and the form of balance sheet prescribed thereunder in the following terms : "At the very outset there is an initial difficulty in arriving at a correct estimate of the financial position of banks. There are two circumstances which militate against our securing a proper insight into the financial state of banks. We refer in particular to (a) the undisclosed or secret reserves and (b) to the manner in which it is permissible in law for a banking company to exhibit its balance sheet. It is not in dispute that bank do have undisclosed or secret reserves which they acquire in a number of ways, and such undis closed reserves cannot be ascertained from the balance sheet. . . . . . . x x x The other difficulty with which we are confronted at the outset is the manner in which a bank is permitted to present its profit & lose account. On the income side the form originally prescribed by the Banking Companies Act required the banks to declare "Income less provision made during the year for bad and doubtful debts)" ; this has now been altered by an amendment made by the Central Government in exercise of the powers conferred under sub section 4 of section 29 of the Banking Companies Act to read "Income (less provision made during the year for bad and doubtful debts and other usual or necessary provisions)". The effect of this alteration is that the profits as shown for any 281 particular year are first shown not only of bad and doubtful debts but also of 'other usua l or necessary provisions ' before being shown in the balance sheet. . . . It maybe that these other usual or necessary provisions ' have been passed by the Board of Directors, and by the auditors of the concern and may even have been scrutinized by the Reserve Bank of India ; but it is our duty and function to decide the question of the capacity of a bank to pay, and in the absence of important information of this character our estimate of the capacity of a concern to pay must necessarily be incom plete. . . . Banks feel that they now have the form of the Banking Companies Act to shield themselves against an enquiry on the subject ; but insofar as we are concerned we consider these undisclosed reserves and these appropriations. relevant for the purposes of our investigation and in their absence we would have to decide as beat as we could from the other materials before us; and draw such inferences as justified. " It was the contention of the workmen that an Industrial Tribunal had the right in law to compel banks to sis, lose their secret reserves as well as the amount of "the bad and doubtful debts and other necessary provisions" which bad been excluded under the head "income" in the, Profit & Loss Account of banks. This matter was agitated by them before this Court in State Bank of India and others vs Their Workmen (1) being an. appeal against the decision of the Labour Appellate Tribunal. In view, however, of the conclusion reached by this Court on other parts of the case it refrained from pronouncing upon the correctness or otherwise of this claim by the workmen. The diputes between the employees of banks (1)(1959), 2 L.T L. J. 205. 282 and the managements, however, continued with the result that on March 21, 1960 the Central Government in exercise of the powers conferred on it by sub section (1A) of section 10 of the referred the dispute which related to several matters to the National Tribunal constituted by & Notification of Government of the same date, K. T. Desai, J. was the Tribunal so appointed. Most of the major banks in the country were made parties to the reference including the Reserve Bank and State Bank of India. After the Tribunal started functioning and after the parties formulated their respective contentions, applications were filed by the Bank Employees Association on June 9, 1960, for directing the respondent banks to produce before the Tribunal for the purposes of adjudication several documents listed in the applications. Among the items in respect of which production was thus sought were (1) statements showing "the secret reserves in any form" of each bank from 1954 right upto December 31, 1959 ; and (2) statements showing the provision made "for bad and doubtful debts and other usual and necessary provisions" during the years 1954 to 1959 and the total amounts outstanding in such items in each bank in the said years. The banks filed their reply on July 16, 1960. The production of the documents and the information called for on several of the matters including the above two was resisted by the Indian Banks Association (being an association of employers) on the ground that they were by law exempted from disclosure in the interest of the industry and the public and claimed absolute privilege from making the disclosure. It was at this stage that the impugned provision was enacted by Parliament as an amendment to the Banking Companies Act. As several of the banks relied upon the impugned provisions in support of their plea that they could not be compelled to disclose either the quantum of their secret reserves or their nature, or as regards the provision made in 283 the several years for "bad and doubtful debts and for other reasonable and necessary provision", the bank employees association challenged the constitutional validity of section 34A of the Banking Companies Act, which, if valid, could have afforded a sufficient answer to the demand for production of the documents in relation to these matters. This objection was argued before the National Tribunal which upheld the validity of the section. As we have stated earlier, Civil Appeal No. 154 is directed against and challenges the correctness of this decision. The Writ Petitions have been filed by Bank Employees Associations which were not parties to the application for production before the National Tribunal and are intended to support the plea of the appellant in Civil Appeal No. 154 of 1961. The foregoing narrative would show that the Banking Companies Act, as it stood before the amendment now challenged, had brought the law as to the disclosure of secret reserves and the provision for bad and doubtful debts etc. Into accord with the usual practice of Bankers, and had protected these items from being compulsorily disclosed to the shareholders of the respective companies and to the general public. There had been a controversy as to whether the workmen of these establishments were or were not entitled to be placed on a different position from the shareholders because of the bearing of these undisclosed items on the determination of the quantum of their wage etc. and on their conditions of work having financial implications. Parliament had, by the impugned legislation, extended the protection from compulsory disclosure to the workmen as well, but with a safeguard in their cue that the Reserve Bank would determine the amount of reserves etc. which could be taken into account in the course of industrial adjudication. The question before us is, is this attempt at some approximation of the position of the workmen to that of shareholders etc. unconstitutional ? 284 Mr. Chari, learned Counsel for the appellant in Civil Appeal No. 154 addressed to us the main arguments in the case and these were supplemented by learned Counsel appearing for the petitioners in the several writ petitions and also by learned Counsel on behalf of the Interveners both in the appeal as well as in the petitions. Though the arguments before us ranged over a very wide field, the attack on the validity of the legislation was rested on two main grounds : (1) that the impugned legislation contravened the fundamental right guaranteed to "trade unions" by the provi sion contained in sub cl. (c) of el. (1) of article 19; and (2) that it violated the freedom of equality guaranteed by article 14 of the Constitution. We shall consider these two points in that order : First as to the impugned provision being obnoxious to, or in contravention of sub cl.(c) of cl. (1) 'of article 19 'of the ' Constitution. This Article runs, to quote only the relevant words "Article 19. (1) All citizens shall have the right (a). . . . . . . . (b). . . . . . . . (c) to form associations or unions The right is subject to the qualification contained in cl.(4), reading : "(4). Nothing in sub clause (c) of the said clause shall affect the operation of any existing law insofar as it imposes, or prevent the State from making any law imposing, in the interests of public order or morality, reasonable restrictions on the exercise of the right conferred by the said sub clause. " It is not the contention of any of the learned Counsel that the right of workmen to form unions or associations which is the right guaranteed by sub cl. (c) of cl. (1) of article 19 on its literal reading has 285 been denied by the impugned legislation. The argument, however, was that it would not be a proper construction of the content of this guaranteed freedom to read the text literally but that the freedom should be so understood as to cover not merely a right to form an union in the sense of getting their union registered so as to function as an union, i.e., of placing no impediments or restrictions on their formation which could not be justified as dictated by public order or morality but that it extended to confer upon unions so formed a right to effectively function as an instrument for agitating and negotiating and by collective bargaining secure, uphold or enforce the demands of workmen in respect of their wages prospects or conditions of work. It was further submitted that unless the guaranteed right comprehended these, the right to form an Union would be most illusory. To understand the implications of learned Counsel 's submission in their proper perspective the several steps in the reasoning might be set out as follows : (1)The Constitution guarantees, by sub cl.(c) of cl. (1) of article 19, to citizens in general and to workers in particular the right to form unions. In this context it was pointed out that the expression `union ' in addition to the word ,association ' found in the Article refers to associations formed by workmen for "trade union" purposes ; the word "union, being specially chosen to designate labour or Trade unions. (2)The right to "form an union" in the sense of forming a body carries with it as a concomitant right a guarantee that such unions shall achieve the object for which they were formed. If this concomitant right were not conceded, the right guaranteed to form an union would be an idle right, an empty shadow lacking all substance. (3)The object for which labour unions axe brought into being and exist is to ensure collective 286 bargaining by labour with the. employers. The necessity for this has arisen from an incapacity stemming from the handicap of poverty and consequent lack of bargaining power in workmen as compared with employers which is the reason d 'etre for the existence of labour organizations. Collective bargaining in order to be effective must be enforceable labour withdrawing its co operation from the employer and there is consequently a fundamental right to strike a right which is thus a natural deduction from the right to form unions guaranteed by sub cl. (c) of cl.(1) of article 19. As strikes, however, produce economic dislocation of varying intensity or magnitude, a system has been devised by which compulsory industrial adjudication is substituted for the right to strike. This is the ratio underlying the provisions of the under which Government is empowered in the event of an industrial dispute which may ultimately lead to a strike or lock out or when such strikes or lock outs occur, to refer the dispute to an impartial Tribunal for adjudication with a provision banning and making illegal strikes or lock outs during the pendency of the adjudication proceedings. The provision of an alternative to a strike in the shape of industrial adjudication is a restriction on the fundamental right to strike and it would be reasonable and valid only if it were an effective substitute. (4)For an adjudication to satisfy the tests of reasonableness and effectiveness two conditions are necessary : (a) that the adjudicator should be enabled to have before him all the materials which are necessary for pronouncing upon the matter in controversy before him ; and (b) that the adjudicator by whom the controversy between the parties should be decided should be an impartial person or body who would render the decision or award after fully hearing the parties, and that no matter in controversy should be the subject of ex parte decision by an interested party or without the disputants having an opportunity to know the, 287 materials on which the decision is reached, as also an opportunity to place their case with reference to such material. (5)In regard to the right of labour unions to function effectively and to achieve the object of their existence as set out earlier, by negotiated settlement or by compulsory adjudication, the only limitations permitted to be imposed by law are those set out in cl.(4) of article 19 and unless, therefore, either the objects of the association or the marmer of achieving them are contrary to, or transgress public order or morality, for which reason alone reasonable restrictions might be imposed upon the guaranteed right, the. freedom guaranteed is absolute. (6)The legislation now impugned withdraws as it were a vital issue in dispute between the parties before the adjudicator, viz:, the capacity of the industry to pay, from his cognisance and vests the power of deciding that issue in the Reserve Bank which is a biased and interested party, the decision itself being rendered ex parte, the trade unions being deprived even of the knowledge of facts which lead to the decision. It was on this line of reasoning that learned Counsel submitted that the impugned enactment violated the freedom guaranteed by sub cl. (c) of el. (1) of article 19. We shall now proceed to consider the soundness and tenability of the steps in the reasoning. It is not necessary to discuss in any detail the first step as sub cl. (c) of el. (1) of article 19 does guarantee to all citizens the right ',to from associations". It matters little whether or not learned Counsel is right in his submission that the expression "union ' in the clause has reference particularly to Trade Unions or whether the term is used in a generic sense to designate any association formed for any legitimate purpose and merely as a variant of the expression "Association" for comprehending every body of persons so formed. It is not controverted 288 that workmen have a right to form "associations or unions" and that any legal impediment in the way of the formation of such unions imposed directly or indirectly which does not satisfy the tests laid down in cl. (4) would be unconstitutional as contravening a right guaranteed by of the Constitution It is the second step in the argument of the learned Counsel, viz., that the right guaranteed to form "an union" carries with it a concomitant right that the achievement of the object for which the union is formed shall not be restricted by legislation unless such restriction were imposed in the interest of public order or morality, that calls for critical examination. We shall be referring a little later to the authorities on which learned Counsel rested his arguments under this head, but before doing so we consider it would be proper to discuss the matter on principle and on the construction of the constitutional provision and then examine how far the authorities support or contradict the conclusion reached. The point for discussion could be formulated thus : When sub cl. (c) of cl. (1) of article 19 guarantees the right to form associations, is a guarantee also implied that the fulfilment of every object of an association so formed is also a protected right, with the result that there is a constitutional guarantee that every association shall effectively achieve the purpose for which it was formed without interference by law except on grounds relevant to the preservation of public order or morality set out in cl. (4) of article 19? Putting aside for the moment the case of Labour Unions to which we shall refer later, if an association were formed, let us say. for carrying on a lawful business such as a joint stock company or a partnership, does the guarantee by sub cl.(c) of the freedom. to form the association, carry with it a further guaranteed right to the company or the partnership to pursue its trade and achieve its profit making object and that the only limitations 289 which the law could impose on the activity of the association or in the way of regulating its business activity would be those based on public order and morality under cl. (4) of article 19? We are clearly of the opinion that this has to be answered in the negative An affirmative answer would be contradictory of the scheme underlying the text and the frame of the several fundamental rights which are guaranteed by Part III and particularly by the scheme of the seven freedoms or groups of freedoms guaranteed by sub cls. ( 'a) to (g) of el. (1) of article 19. The acceptance of any such argument would mean that while in the case of an individual citizen to whom a right to carry on a trade or business or pursue an occupation is guaranteed by sub cl. (g) of cl. (1) of article 19, the validity of a law which imposes any restriction on this guaranteed right would have to be tested by the, criteria laid down by cl. (6) of article 19. if however he associated with another and carried on the same activity say as a partnership, or as a company etc. , he obtains larger rights of a different content and with different characteristics which include the right to have the validity of legislation restricting his activities tested by different standards, viz., those laid down in el. (4) of article 19. This would itself be sufficient to demonstrate that the construction which the learned Counsel for the appellant contends is incorrect, but this position is rendered clearer by the fact that article 19 as contrasted with certain other Articles like articles 26, 29 and 30 grants rights to the citizen as such, and associations can lay claim to the fundamental rights guaranteed by that Article solely on the basis of their being an aggregation of citizens, i.e., in right of the citizens composing the body. As the stream can rise no higher than the source, associations of citizens cannot lay claim to rights not open to citizens, or claim freedom from restrictions to which the citizens: composing it are subject. The resulting position way, be illustrated thus If an association were formed ' for ' the purpose of 290 arrying on business, the right to form it would be Guaranteed by sub cl. (c) of cl. (1) of article 19 subject to any law restricting that right conforming to cl. (4) of article 19. As regards its business activities, however, and the achievement of the objects for which it was brought into existence, its rights would be those guaranteed by sub cl. (g) of cl. (1) of article 19 subject to any relevant law on the matter conforming to el. (6) of article 19 ; while the property which the association acquires or possesses would be protected by sub el. (f) of cl. (1) of article 19 subject to legislation within the limits laid down by cl. (5) of article 19. We consider it unnecessary to multiply examples to further illustrate the point. Applying what we have stated earlier to the case of a labour union the position would be this : while the right to form an union is guaranteed by sub el. (c), the right of the members of the association to meet would be guaranteed by sub el. (b), their right to move from place to place within India by sub cl.(d), their right to discuss their problems and to propagate their views by sub cl. (a), their right to hold property would be that guaranteed by sub cl. (f) and so oneach of these freedoms being subject to such restrictions as might properly be imposed by cls. (2) to (6) of article 19 as might be appropriate in the context. It is one thing to interpret each of the freedoms guaranteed by the several Articles in Part III a fair and liberal sense, it is quite another to read which guaranteed right as involving or including 'Concomitant rights necessary to achieve the object which might be supposed to under lie the grant of each of those rights, for that construction would, by a series of ever expanding concentric circles in the shape of rights. concomitant to concomitant rights and so on, lead to an almost grotesque result. There is no doubt that in the context of the principles underlying the Constitution and the manner in which its Part III has been framed the 291 guarantees embodied in it are to be interpreted in a liberal way so as to subserve the purpose for which the constitution makers intended them and not in any pedantic or narrow sense, but this however does not imply that the Court is at liberty to give an unnatural and artificial meaning to the expressions used based on ideological considerations. Besides it may be pointed out that both under the Trade Unions act as well as under the the expressions `union signifies not merely a union of workers but includes also unions of employers. If the fulfilment of every object for which an union of workmen was formed were held to be a guaranteed right, it would logically follow that a similar content ought to be given to the same freedom when applied to an union of employers which would result in an absurdity. We are pointing this out not as any conclusive answer, but to indicate that the theory of learned Counsel that a right to, form unions guaranteed by sub cl. (c) of ol.(1) of article 19 carries with it a fundamental right in the union so formed to achieve every object for which it was formed with the legal consequence that any legislation not falling within el. (4) of article 19 which might in any way hamper the fulfilment of those objects, should be declared unconstitutional and void under Art, 13 of the Constitution, is not a proposition which could be accepted as correct. Besides the qualification subject to which the right under sub cl. (c) is guaranteed, viz., the contents of el. (4) of article 19 throw considerable light upon the scope of the freedom, for the significance and contents of the grants of the Constitution are beat understood and read in the light of the restrictions imposed. If the right guaranteed included not merely that which. would flow on a literal reading of the Article, but every right which is necessary in order that the association brought into existence fulfils every object for which it is formed, the qualifications therefor, would be not merely those in cl.(4) of Art, 19, but would be. more numerous and 292 very different, restrictions which bore upon and took into account the several fields in which associations or unions of citizens, might legitimately engage themselves. Merely by way of illustration we might point out that learned Counsel admitted that though the freedom guaranteed to workmen to form labour unions carried with it the concomitant right to collective bargaining together with the right to strike, still the provision in the forbidding strikes in the protected industries as well as in the event of a reference of the dispute to adjudication under section 10 of the was conceded to be a reasonable restriction on the right guaranteed by sub cl.(c) of cl.(1) of article 19. It would be seen that if the right to strike were by implication a right guaranteed by sub cl. (c) of cl. (1) of article 19 then the restriction on that right in the interests of the general public, viz., of national economy while perfectly legitimate if tested by the criteria in el. (6) of article 19, might not be capable of being sustained as a reasonable restriction imposed for reasons of morality or public order. On the construction of the Article, therefore, apart from the authorities to which we shall refer presently, we have reached the conclusion that even a very liberal interpretation of sub cl. (c) of cl. (1) of article 19 cannot lead to the conclusion that the trade unions have a guaranteed right to an effective collective bargaining or to strike, either as part of collective bargaining or otherwise. The right to strike or the right to declare a look out may be controlled or restricted by appropriate industrial legislation, And the validity of such legislation would have to be tested not with reference to the criteria laid down in cl.(4) of article 19 but by totally different considerations. We shall now proceed to consider the authorities, relied ion by the learned Counsel in support of this theory of "Concomitant right" to collective bargaining guaranteed to labour unions. first as regards the decisions of this Court on which learned 293 Counsel relied Romesh Thappar vs The State of Madras(1)Was the earliest case referred to; and learned counsel placed reliance in particular on the following passage in the judgment of the learned Chief Justice : "Turning now to the ' merits, there can be no doubt that freedom of speech and expression includes freedom of propagation of ideas, and that freedom is ensured by the freedom of circulation. 'Liberty of circulation is as essential to that freedom as the liberty of publication. Indeed, without circulation the publication would be of little value : Ex parte Jackson, ; Based on this, learned Counsel submitted that if the phrase "freedom of speech and expression ' in sub cl. (a) of el. (1) of article 19 were given this liberal construction so as to effectuate the object for which the freedom was conferred, a similar construction ought to be adopted of the content of the freedom guaranteed by sub cl. (c) of el. (1) of article 19. We are, however, unable to discern any analogy between the two cases. It is obvious that "freedom of speech" means freedom to speak so as to be heard by others, and therefore to convey one 's ideas to others. Similarly the very idea of freedom of expression necessarily connotes that what one has a right to express may be communicated to others. Unless therefore the freedom guaranteed by sub cl.(a) of el. (1) of article 19 were read as confined to the right to speak to oneself or to express his ideas to himself, which obviously they could not mean, the guaranteed freedom would mean freedom to address others, and of conveying to others one 's ideas by printed word, viz., freedom of circulation. We do not see, therefore, any analogy between the case which was considered by this Court in Romesh Thappar 's (1) case and the one before us. (1) ; In A. 294 The observations in the judgment of Bhagwati, J. in Express New,,?,papers (Private) Ltd. vs Union of India(1) on which Counsel relied, in regard to the content of the 'freedom of speech and expression that they "include within its scope the freedom of the press", for the press with the printed word is merely the mechanism by which the freedom is exercised do Dot really carry the matter any ` further. We were next referred to the observations of Das C. J. in the advisory opinion Re the Kerala Education The question, which was being considered in the passage,relied on, related to the scope and content of cl. (1) of article 30 which guaran tees to all minorities a right to establish and administer educational institutions of their choice. The question debated before this Court was, whether the provision in the Kerala Education Bill which denied recognition by Government to educational institutions run by minorities contravened this freedom guaranteed to them ? Dealing with this Das C. J. said : "Without recognition, therefore, the edu cational institutions established or to be established by the minority communities cannot fulfil the real objects of their choice and the rights under article 30(1) cannot be effectively exercised. The right to establish educational institutions of their choice must, therefore, mean the right to establish real institutions which would effectively serve the needs of their community and the scholars who resort to their educational institutions. There is, no doubt, no such thing as fundamental right to recognition by the State but to deny recognition to ' the educational institutions except upon terms tantamount to the surrender of their constitutional right of administration of the educational institutions of their choice is (1) (2) 1959 S.C.R. 995. 295 in truth and in effect to deprive them of their rights under article 30 (1).19 We do not consider that these observations and this construction of el. (1) of article 30 assist learned Counsel in his submission as regards the theory of concomitant rights flowing from the freedom guaranteed by sub cl. (c) of cl. (1) of article 19. The observations of the learned Chief Justice and the conclusions drawn are in relation to the construction of article 30 and cannot be divorced from ' the context. They do not purport to lay down any general rule of construction for the freedoms guaranteed under the several sub heads of cl. (1) of article 19, and, indeed, what we have pointed out earlier should suffice to indicate the impossibility of upholding any such construction of the freedoms guaranteed by the latter Article. Learned Counsel also referred us to certain passages in two judgments of the Supreme Court of the United States : National Association for the advancement of colored people vs Alabama,(1)and Bates vs Little Rock(2)in which the Court held that, freedom of speech and assembly which were fundamental rights guaranteed by the Constitution would be abrogated or improperly encroached upon by legislation 'which compelled the disclosure to public authorities of the membership rolls. In the two decisions the facts were that the associations in question were for the protection of coloured persons and the requirement of disclosure of the names of members was inserted in the law for the purpose of putting a pressure upon these associations so as to dissuade people from joining them. The argument of learned Counsel before us was based on the dicta in these two decisions that the I right to form an association which followed by reason of the due process ' clause in the 14th amendment carried with it the right to ensure that the associations were able to maintain themselves as associations. In the two (1) 2 Law. Second 1488. (2) 4 Law. Second 480. 296 decisions referred to, the learned Judges of the Supreme Court of the United States were not construing the content of a provision on the lines of article 19(1)(c), for in America, the right of association is not any specifically guaranteed right, but has been derived by judicial interpretation of the due process clause of the 14th Amendment. But apart from this the legislation there impugned was one which directly affected the formation of the association and in that sense may be hit by the terms of sub cl.(c) of cl.(1) of article 19 if statutes with similar purpose were enacted in India. The decisions cited are no authority for the second step in the argument for which they were cited. Learned Counsel also referred us to two other decisions of the Supreme Court of the United States in which the right of employees to self organization, to form, join and assist labour organisations and to bargain collectively through representatives of their own choice and to engage in concerted Activities for the purpose of collective bargaining or other mutual aid has been referred to as "a fundamental right" (vide National Labor Relations Board vs Jones and Laughlin Steel Corporation and ors. , (1) and Amalgamated Utility Workers vs Consolidated Edison Company of New York) (2). We do not consider the inference sought to be drawn well founded. What the learned Judges of the Supreme Court were referring to as a fundamental right was not with reference to a fundamental right as recognized or guaranteed by the Constitution, but in the sense of a right of the unions which enacted law. recognized or respected, and as other decisions of the United states ' Supreme Court show, was subject to regulation by the legislature(3). We have, therefore, reached the conclusion that the right guaranteed. by sub cl.(c) of cl.(1) of article 19 does not carry with it a concomitant right (1) ; ,909. (2) ; , 741. Vide Weaver Constitutional Law and its Administration (1 946) p. 505, referring to Dorchy vs, Kansas ; : "Neither he common law nor the 14th Amendment confers the absolute right to strike. " 297 that the unions formed for protecting the interests of labour shall achieve the purpose for which they were brought into existence, such that any interference, to such achievement by the law of the land would be unconstitutional unless the same could be justified as in the interests of public order or morality. In our opinion, the right guaranteed under sub cl. (c) of el. (1.) of article 19 extends to the formation of an association and insofar as the activities of the association are concerned or as regards the steps which the union might take to achieve the purpose of its creation, they are subject to such laws as might be framed and that the validity of such laws is not to be tested by reference to the criteria to be found in cl. (4) of article 19 of the Constitution. In this view it is not necessary to consider the other steps in. the argument of learned Counsel all of which proceed upon the correctness of the step which we have just now disposed of. Nevertheless we consider it proper to deal with the submission that the impugned legislation (a) withdraws an essential part of the dispute between the parties from the jurisdiction of an impartial adjudicator and vests the same in the Reserve Bank of India which is a biased body ; and (b) that the adjudicator is left without proper materials to discharge his duties by withdrawing the, proper materials from his cognizance. A complaint that the impugned provision withdraws the dispute from the adjudication of an impartial arbitrator and leaves it to the decision of another body is an obvious overstatement of the position. The dispute between the parties in relation either to wages, bonus or other amenities or perquisites which involve financial obligations on the part of the employer remain even after the impugned provision was enacted, with the adjudicator and he alone determines the rights of the parties subject to the provisions of the Industrial law or other relevant legislation, and the relief which he could award to the employees remains 298 the same. The adjudicator alone determines ' the capacity of the industry to pay or to bear the enhanced cost. The only result of section 34 A is that in regard to two itmes, viz., secret reserves and the provision made by banks "for bad and doubtful debts and other necessary provisions", the reasonable quantum which would be available for being taken into account by the adjudicator would be estimated and determined by an expert body which is a governmental authority or practically a department of Government, viz., the Reserve Bank of India which is entrusted by law with duty of maintaining the credit structure of the country. From what we have 'stated earlier as the genesis of the legislation now impugned, it would be apparent that Government had to effect a reconciliation between two conflicting interests : one was the need to preserve and maintain the delicate fabric of the credit structure of the country by strengthening the real as well as the apparent credit worthiness of banks operating in the country. It was really this principle which is vital to the economic life of the community that has been responsible for the changes that have been made from 1927 onwards as regards the form of balancesheet and of the Profit & Loss accounts of banking companies as distinguished from other trading and industrial organizations. There was urgent need to protect from disclosure certain of the items of appropriation by banks in order to preserve them as credit institutions. On the other hand, there was the need an equally urgent need for enabling the workers in these institutions not to be denied a proper wage and other emoluments and proper conditions of service. the question was how far information which in the interests of national economy the banks were entitled to withhold from their shareholders and the general public, was to be made available for determining the capacity of the banks to pay their employees. It was in these Circumstances that the impugned legislation was 299 enacted which while preserving industrial adjudication in respect of disputes between the banks and their employees, entrusted the duty of determining the surplus reserve which could be taken into account as part of the assets for determining capacity to pay, to the Reserve Bank. Thus understood there does not appear to be anything unreasonable in the solution which the I impugned legislation has effected. We do not also consider that there is any substance in the complaint that the Reserve Bank of India is a biased body. If it was not the Reserve Bank of India, the only other authority that could be entrusted with the function would be the Finance Ministry of the Government of India and that department would necessarily be guided by the Reserve Bank having regard to the intimate knowledge which the Reserve Bank has of the banking structure of the country as a whole and of the affairs of each bank in particular. In the circumstance therefore it matters little from the point of view of the. present argument whether it is the Finance Ministry that was vested with the power to determine the matters set up in section 34 A or whether it is the Reserve Bank that does so, as under the impugned enactment. Learned Counsel made a further submission that the impugned enactment was a piece of colourable legislation and that the purported objective of securing secrecy from disclosure was really a device adopted for depressing wages and for denying to workmen employed in banks their legitimate rights. It was urged that the preamble to the amending Act sought to make out that the real purpose behind the legislation was the ensuring of secrecy from disclosure of the reserves held by the banks and of the bad and doubtful debts which arose in the course of business and the provision made for these losses and proceeded on the ratio that such disclosure would hurt the credit of the 300 banks which would have repercussions not merely on the individual bank but also on the banking structure of the country as a whole. This, it was submitted, was not the real but only the colourable object and purpose underlying the legislation. In this connection it was stressed that section 21 of the and r. 30 of the Industrial Disputes Rules had made ample provision for securing secrecy to the affairs of every concern in regard to which disclosure would not be in public interest. We are satisfied that this submission has no basis in fact and besides even if made out does not affect the validity of the legislation. As we have pointed out already, the impugned legislation merely carries out to its logical conclusion the effect of the changes in the form of the balance sheet and Profit and Loss accounts of Banks which starting in 1927 culminated in the notification dated December 22, 1951 under section 29 (4) of the Banking Companies Act amending the Forms appended to that Act. If the construction of the "right to form unions" under sub cl. (c) of cl.(1) of article 19 put forward by learned Counsel for impugning the validity of the enactment is negatived, then subject to the point about article 14 which we shall examine presently, legislative competence being conceded there could be no legal objection to its validity. Objections based on colourable legislation have relevance only in situations when the power of the legislature is restricted to particular topics, and an attempt is made to escape legal fetters imposed on its powers by resorting to forms of legislation calculated to mask the real subject matter. No such problem exists in the present case and it is common ground that once the legislation passes the test of the fundamental rights,guaranteed by Part III, legislative competence not being in dispute, its. validity is beyond cavil. The question whether the secrecy assured by section 21 of is or is not sufficient to protect the interests of I the Banks, is a matter of legislative policy and is for Parliament 301 alone and even the fact that the Court could be persuaded that the existing law is sufficient would be no ground for invalidating the 'impugned legislation. When the end which the legislature reeks to achieve, viz ., secrecy is competent, the enquiry as to ultra vires stops. Whether less than what was done might have been enough, whether more drastic provision was made than occasion demanded, whether the same purposes could have been achieved by provisions differently framed or by other means, these are wholly irrelevant considerations for testing the validity of the law. They do not touch or concern the ambit of the power but only the manner of its exercise, and once the provisions of of the Constitution are out of the way, the validity of the legislation is not open to challenge. The next point urged was that the impugned provision was in violation of article 14; though the several learned Counsel who. appeared in support of the case of the workers were not all agreed as to the precise grounds upon which it could be ' held that the impugned provision violated article 14. It was first submitted that the provision was rendered invalid because it vested an arbitrary power in. banks which were parties to a dispute under the , to claim or not to claim the privilege of not producing the documents and that no criterion had been indicated as to the Circumstances in which Banks could decide to make the claim. But this, however, is answered by the provision itself which runs "When the banking company, claims that such document, statement of information is of a confidential nature and: that the production or inspection of such document. would involve disclosure of '. information relating to the matters set not the. matters set out in sub clauses (a) and (b)" 302 It was also submitted that sub cl. (b) of sub section (1) was vague, in that a reference was made to "provision made for bad and doubtful debts and other usual or necessary provisions". We do not see any substance in this point either, because these words are taken from the form under the Banking Companies Act and their meaning is clear in banking circles. In fact, in the application which the employee associations made before the adjudicator to direct the production of information and documents from the banks this phrase was used and it is apparent that even the Bank Employees ' Associations understood it as having a definite connotation. It was next submitted on behalf of some of the interveners that section 34A(1) and (2) violated article 14 in that the classification contained in it was impermissible as not being based on rational grounds. It was said (1) that the protection against a disclosure applied only to adjudications under the industrial Disputes Act and not to other adjudications ; (2) that it applied only to certain banking companies and not to all banking companies; and (3) that by reason of section 34A (2) the provisions of the impugned enactment were applied in a discriminatory manner to all banks other than the Reserve Bank. The first two points cover the same ground and arise out of the fact that the. impugned provision by its 3rd sub section defines a "banking company" referred to in it and to which its provisions apply, as meaning a ""Banking Company" under the . The defines a "Banking Company" in section 2(b) as follows: "Banking Company means a banking company as defined in section 5 of the Banking Companies Act, 1949, having branches or other establishments in more than one State and includes the State Bank of India and the Reserve Bank of India. " 303 It would thus be seen that though the Banking Companies Act applied to every banking company it is only those banks whose operations extended beyond one State were brought within the scope, of the definitions of a "banking company" under the . The result of that was that Banking Companies not having branches in more than one State would be an industry so as to be within the but not , 'a banking company" within its definition. In the circumstances learned Counsel is right in his submission that such banking companies as are not within the definition of "a banking company" under the would not be entitled to claim the protection from disclosure conferred on "banking companies" by the impugned provision. This, however, is no ground for holding the legislation invalid. In the first place, the complaint of discrimination is not by the banks who are not on the terms of section 34A entitled to the protection from disclosure of their reserves etc. Secondly it is common ground that 95 % of the banking business in this country is in the hands of Banks which are, within the definition of "banking companies" under section 2(b) (b) of the . Besides, these banks, employ over 80,O0O out of the 90,000 bank employees. In the circumstances and seeing that the injury to the credit structure will only be by the disclosure of the reserves etc., of the banks of this class, there is sufficient rational connection and basis for classification to justify the differentiation. The fact that the legislation does not cover every banking company is therefore no ground for holding the provision to be discriminatory within article 14. The last point about the exclusion, of the Reserve Bank of India from the operation of section 34A (2) has also no substance. in the very nature of things and on the scheme of the provision the Reserve Bank could not but be excluded from sub section (3) of the impugned provision. In determining 304 what reserves could properly be taken into account, the Reserve Bank would be discharging not any quasi judicial but only an administrative function, determining this matter with reference to uniform business principles and it therefore appears to us that. there is no impropriety in its findings being final even in regard to itself. A submission on similar lines about bias was also made in relation to the impact of the impugned provision insofar as it related to the industrial dispute between the State Bank of India and its employees. It was pointed out to us that the Reserve Bank of India owned practically the entirety of the sharecapital of the State Bank of India, with the result that the Reserve Bank was pecuniarily and vitally interested in supporting the State Bank as against the latter 's employees in any industrial dispute and that the element of bias which the situation involved would invalidate the impugned provision. We consider this argument without force. If, as we have held, the impugned provision is valid and does not violate any of the freedoms guaranteed by of the Constitution in regard to the employees of the Reserve Bank, the challenge to the impugned provision cannot obviously be successful in the case of the employees of the State Bank. As we have stated earlier, though the arguments before us ranged on a very wide ground, we have not thought it necessary to deal with all of them because in view of our conclusions on the crucial points in the case the others which were subject of debate before us did not arise for consideration. The appeal fails and is dismissed with costs. The petitions also fail and are dismissed with costs. (one hearing fee) Appeal and Petitions dismissed.

Section 34 A of the Banking Companies Act, 1949, introduced in 1960, provides that no banking company shall be compelled to produce or give inspection of its books of account or other document or furnish or disclose any statement or in formation which the company claims to be of a confidential nature and the production etc., of which would involve dis closure of information relating to any reserves not shown as such in its published balance sheet or any 'particulars not shown therein in respect of provisions made for bad and doubtful debts and other usual or necessary provisions. Sub section (2) of section 34 A provides that any authority, before whom the question as to whether any amount out of such reserves or provisions should be taken into account, may refer the question to the Reserve Bank and the Reserve Bank shall furnish to the authority a certificate stating that the authority shall or shall not take into account the amount specified therein. Sub section (3) makes section 34 A applicable to only such banking companies whose operations extend beyond one State. The Appellant contended 270 that section 34 A contravened the fundamental right guaranteed to trade unions by Art 19(1)(c) of the Constitution as it prevented them from effectively exercising the concomitant right of collective bargaining in respect of wages, bonus etc. before industrial Tribunals by shutting out important and relevant evidence and that the section violated article 14 of the Constitution as it was not made applicable to all the banking companies. Held, that section 34 A of the. Banking Companies Act, 1949, was constitutionally valid and did not and either article 19(1)(c) or article 14 of the Constitution. The right guaranteed by article 19(1)(c) of the Constitution does not carry with it a concomitant right that unions formed for protecting the interests of labour shall achieve their object such that any interference to such achievement by any law would be unconstitutional unless it could be justified,under article 19(4) as being in the ' interests of Public order or morality. The right under article 19(1)(c) extends only to the formation of an association or union and insofar as the activities of the association or union are concerned or as regards the steps which the union might take to achieve, its object, they are subject to such laws as, may be framed and such laws cannot be, tested under article 19(4). Section 34 A was, enacted to effect a i.e conciliation between the conflicting interest of labour to obtain proper relief in industrial arbitration and tire need to preserved and maintain the delicate fabric of the credit structure of the country by strengthening the as well as the apparent credit worthiness of banks operating in the country. It preserved industrial adjudication in respect of disputes between the banks and their employees by entrusting the duty of determining the surplus reserve which could be taken into account as a part of the assets for determining their capacity to pay to the Reserve Bank. Ramesh Thappar vs State of Madras ; Express Newspapers (P) Ltd. vs Union of India, , Be. The Kerala Education Bill, (1959) S.C.R. 995, National Association for the advancement of coloured people vs Alabama, 2 Law. Second 1488, Bates vs Little Rock, 4 Law Ed. Second 480,. National Labour Relations Board vs Jones & Lauqhlin Steel Corporation, ; and Amalgamated Utility Workers vs Consolidated Edison Company of New York, ; , referred to. Though there were certain banks which were not entitled to the protection of section 34 A that was no ground for holding that the section offended article 14. The complaint was not made by the banks who were not given the protection. Admittedly, 95% of the banking business in the country was in the hands of 271 banks to whom section 34 A applied and. they employed 80,000 out of the 90,000 bank employees. The injury to the credit, structure will only be by the disclosure of the reserve etc. ' of the banks of this class and there is sufficient rational connection and basis for the classification to justify the differentiation. The exclusion of the Reserve Bank from the operation of section 34 A (2) also does not amount to discrimination; in the very nature of things and on the scheme of the provision the reserve Bank could not but be excluded.

Appeal No. 143 of 1956. Appeal by special leave from the judgment and decree dated September 23, 1952, of the Bombay High Court in First Appeal No. 57 of 1949. section P. Desai and I. N. Shroff for the appellant. A. V. Viswanatha Sastri, J. B. Dadachanji, S.N. Andley, Rameshwar Nath and P.L. Vohra, for the respondents. 642 1961. September 13. The Judgment of the Court was delivered by DAS GUPTA, J. The appellant and the Second respondent are both descendants of Vallabhacharyaji, a great Vaishnava teacher who flourished more than 400 years ago. Vallabhacharyaji left his native place near Champaranya in South India, and coming to Gujarat and other parts of India established shrines for the worship of Vishnu at several places. His descendants became the priests and Shebaits of such shrines and also of other shrines established thereafter. These came to be known as Gadis. While each of these Gadis had a temple for the worship of Vishnu, considerable properties, movable and immovable were acquired for them from time to time by gift or otherwise. One such shrine was established more than 100 years ago at Nadiad and about the year 1899 A. D. a descendant of Vallabhacharyaji who on adoption took the name of Anniruddhalalji Murlidharji became the head of the Nadiad shrine and was thus possessed of the movable and immovable properties appertaining to the Gadi. This gentleman also became by, adoption head of another shrine known as the Moti Haveli at Jamnagar in the year 1913 and then took a slightly different name Annirudhalalj 'i Brijeshji. Both these adoptions were in accordance with the Goda Dattak custom of adoption which prevailed among the members of the Vallabhacharya community. Aniruddhalalji Murlidharji (alias Aniruddhalalji Brijeshji) died on December 17, 1935 leaving a widow Mahalaksbmi Bahuji Maharaj, who is the first respondent before Us. The question of adopting an heir to him assumed importance immediately on his death and it appears there was some talk. of adopting by the Goda Dattak custom one of the sons of the present appellant, who it is necessary to mention. was the natural brother of Aniruddhalalji. The talks however proved fruitless and ultimately on June 1, 1946, 643 the second respondent who as already stated was also a descendant of Vallabhacharya was adopted. The present suit was brought by the appellant in respect of the Haveli and other properties left by Anniruddhalalji at Nadiad. In this he, challenges the validity of the adoption of the second respondent by the first respondent, Mahalakshmi Bahuji Maharaj. The main prayer in the suit is for a declaration that respondent No. 2 was not the legally adopted son of Aniruddhalalji and did not acquire any right or shares in his property by the alleged adoption. The other prayers included one for a declaration that he the appellant was the nearest heir of the deceased, that the first respondent had no other right in the property except as a Hindu widow, for an injunction restraining her from frittering away the property or any part thereof, for an order on her to produce the balance of the sale proceeds of Maharaja 's Bag which she had sold off and for an order on both these respondents , to render accounts of the properties of Goswami Anniruddhalalji which might have come into their hands. It is no longer in dispute that the plaintiff would be the nearest heir on the death of the widow if there has been no valid adoption of the second respondent to Aniruddhalalji. The appellant challenged the validity of the adoption on three main grounds. The first was that under the custom ' of the Vallabharcharya community under which Goda Dattak adoption is made, the adoptee (using that word to denote the boy taken in adoption) must be only from the family of the adoptive father if this be possible and in the present case even though the plaintiff himself as well as his two sons were available for adoption the second respondent was adopted in preference to them. The second ground was that under the Goda Dattak custom the wife 's sister 's husband cannot be validly adopted. The third around was that Aniruddhalalji 644 had expressed his desire in this matter of adoption in such a manner that there was an implied prohibition by him from taking in adoption anybody except the present appellant or one of his sons. The first two grounds were raised in Issue No. 8 of the 19 Issues that were framed by the Trial Court while the third ground was raised in Issue No. 12. These Issues are in the following words : Issue No 8 Does the. plaintiff prove the custom that in Goda adoption: (i) a widow cannot adopt her sister 's husband as a son to her husband ? (ii) the adoptee should belong to the family of the adopter ? Issue No. 12: Does the plaintiff prove that the Defendant No. 1 was prohibited by Anniruddhalalji from adopting in the Goda form any one except the plaintiff or one of his sons ? It may be mentioned that an Issue was framed as, regards the factum of adoption in Issue, No. 6, viz., whether Defendant No. 2 's adoption is proved, in view of what was said in paragraph 14 of the plaint that he was not aware whether Defendant No. 1 and Defendant No. 2 had performed any ceremonies or rites according to the Goda Dattak form of adoption or as required by Hindu Law. This issue was answered in the affirmative and the correctness of that answer has not been challenged before us. The Trial Court held that the plaintiff had riot been able to establish the alleged custom for Goda Dattak that a widow could not adopt her sister 's husband as a son to her husband nor that the adoptee should belong to the family of the adopter and accordingly answered Issue No. 8 in the negative. As regards Issue No. 12 the plaintiff relied on a letter which was marked exhibit 115, apart from his own evidence and evidence of some of his witnesses. The Trial Court accepted Defendant No. 1 's contention that this letter had 645 been inspired by the plaintiff himself and so No. reliance could be placed on ' it. The oral testimony given by the plaintiff and other witnesses in support of the story that Aniruddhalalji had in his life time given certain directions in the matter of adoption of a son to him was also found not reliable. Accordingly, Issue ,No. 12 was also answered in the negative. One other argument addressed to the Trial Court was that Defendant No. 1 had not obtained the consent of her husband 's sapindas for this adoption and so under the Madras School of Mitakshara Law, which it is said governed the parties, the adoption was invalid. The Trial Court considered this argument even though the, question whether the Madras School of Mitakshara governed the parties and so the adoption was invalid without the consent of the husband 's, sapindas had not been specifically raised in the pleadings nor had any issue been framed on , ,his. The learned Judge however rejected the argument, being of opinion that "the ordinary law of adoption which puts restrictions on the widow 's right to adopt in Madras cannot be taken to be prevailing in the case of customary adoption in the Goda form by widow in the Goswami families. " Holding that the Defendant No.2 's adoption could not be held to be invalid the Trial Court dismissed the suit with costs. The plaintiff 's appeal to the High Court of Bombay met a similar fate. The learned Judges of High Court agreed with the Trial Court that the plaintiff had not been able to prove either that the wife 's sister 's husband was not eligible for adoption under the Goda Custom or that the son to be adopted must if possible come from the family of their adoptive father. On the question whether there was an implied prohibition to adopt anybody other than the plaintiff or his sons, .also, they agreed with, the Trial Court even though they were not prepared to 646 say that the letter (exhibit 115) was written by the Defendant No., 1 under undue influence of the plaintiff., The learned Judges of the High Court refused to consider the further question raised on behalf of the appellant that the adoption was invalid in the absence of consent of the Sapindas as the proper. pleading on which, such a question could have been raised had not been made in the plaint and no issue had been framed. The High Court refused to frame an issue then, but Rave time to the plaintiff to make an application for amendment of the plaint. An application for amendment was duly made but was rejected by the learned judges who were of opinion that the application had not been made in good faith. The appeal was dismissed with costs. The plaintiff has filed the present appeal against the decision of the High Court after obtaining special leave from this Court. The appellant contends that the Courts below were wrong in holding, firstly. that a custom which barred the adopted of the wife 's sister 's husband in the Goda form of adoption had not been proved. secondly that a custom that if possible the adoptee must be from the family of the adoptive father had not been proved; and lastly that the alleged implied prohibition against adopting anybody excepting the plaintiff and one of his sons had not been established. It was also urged that the High Court was wrong in refusing to entertain the plea that the adoption was invalid in the absence of the consent of the husband 's sapindas and in any case totally wrong in allowing the application for amendment of the plaint seeking to raise such a plea. Before coming to the several grounds urged on behalf of the appellant we have to consider a preliminary objection raised on behalf of the respondent. It is urged that this appeal has become infructuous by reason of, the operation of section 14 of the Hindu Succession Act, It is said that, as 647 admittedly respondent No. 1, Mahalakshmi Bahuji Maharaj, was in possession of the properties in suit at the date of the commencement of the Hindu Succession Act, she became the full owner of the properties in question in case the adoption by her of respondent No. 2 is invalid. There maybe some force in this argument if the properties in question are the private secular properties of Anniruddhalalji. The position may well however be different if these properties were the Devattar properties belonging to the Thakur of which Anniruadhalalji was a Shabeit. It appears that a suit has actually been brought by certain Vaisnavas seeking a declaration that these properties are all Devattar properties of the Thakur. In view of this position we are of opinion that it would not proper for us to decide in the present case whether under section 14 of the Hindu Succession Act Defendant No. 1 had become the full owner of the properties in suit if the adoption by her was invalid. We shall therefore decide this appeal on merits leaving it open to the 1st respondent to pursue her claim under section 14 of the Hindu Succession Act if that becomes necessary. Coming now to the merits of the appeal it is necessary to consider first the question of the alleged limitation on the power to adopt by Goda practice as regards the wife 's sister 's husband or a member from another Vallabhacharya family even though members of the adoptive father 's family be available. It will be helpful to consider in this con nection first the objects of Goda adoption. These objects have been mentioned by plaintiff 's own witness Chandras Shankar Laxmishakar Upadhyaya who appears to have a fair amount of knowledge of Goda Dattaka adoptions, to be three fold. The primary object was mentioned by him to be that 1 & "person going in "Goda" adoption can perform "several (worship) etc., of the Thakorji (idol) and that tradition of "sewa" (worship etc.,) can be ' continued". The second object mentioned by him is "that, after. the death of the 648 person taking in adoption, the person going in adoption can perform his "shraddha" ceremonies etc " ' The third object according to him is "to continue the line of the person taking in adoption. " Other witnesses who have given evidence on this point have said more or less the same thing. It is obvious that if the above be the objects of Goda adoption it must be implicit In the nature of Goda adoption that anybody who would be incapable of accomplishing any of these objects would be ineligible for adoption. It is on this basis that it was urged that wife 's sister 's husband 's son was not eligible. The argument is that the wife 's sister 's husband would be unable to perform the Shradha of the adoptive father because the adoptee would not cease to be the Shadu of the person to whom the adoption is made, it was further said that the adoptee would the incapable of performing the Sradh of the adoptive maternal grand father as the latter would be the adoptee 's father in law. Unfortunately however for the plaintiff 's case 'his witnesses were unable to quote any authority except their own ipso dixit for this proposition that the adoptee would be incapable of performing the Sradh of his adoptive father or adoptee maternal grand father. The plaintiff 's witness Anantkrishna Sastri a Mahamahopadhyaya, made a statement that according to Dharmashastras a wife 's sister 's husband cannot be adopted. As authority for this proposition he relied on a passage in Dattak Mimanea which prohibits the adoption of a daughter 's son, a sister 's son and a mother 's sister 's son and adds thus: "This clearly proves that a daughter 's son and a mother 's sister 's son are (in this respect) equal to a sister 's son. This is just proper because there is in these three, the same degree of (prohibited) marriageship (Viruddha Sambandha). " It is true that Dattak Mimansa has in a later passage gone further and said that son of a woman who could not be married because of Virudha Sambsndhar relationship should be excepted from adoption 649 We have however held in Mrs. Abhiraj Kuer vs Debendra Singh(1) in which judgment has been delivered to day that this rule in Dattaka Mimansa against Viruddha Sambandha putra is only recommendatory and not mandatory. Apart from that it is difficult to see how the wife 's sister 's husband can be considered to be ViruddhaSambandha putra. It is thus clear that even if the limitations of the orthodox Dattak adoption apply to Goda adoption there is no bar to the adoption of, the wife 's sister 's husband. On the materials on the record we are also satisfied that there is no custom barring the adoption of the wife, is sister 's husband in Goda Dattak form. On the question whether in Goda Dattak adoptions the adoptee must if possible be from the family of the adoptive father, it is important to notice that the several objects for which Goda Dattak adoptions are made may well be satisfied even if the adoptee be from some other Vallabhacharya family. Practically the only evidence given in support of the case that there is a custom as alleged that if possible the adoptee must be from the adoptive father 's family is by the plaintiff himself. His witness Lakshmi Shankar Upadhaya, who, as al. ready stated, appears to have considerable ex perience of Goda Dattaka adoptions does not speak of any such custom. Even his witness Hari Krishna Virji Sastri who appears rather partial to him it may be mentioned that he admits having read even the plaint on being sent for by the plaintiff does not speak of any such custom. Against the plaintiff 's own evidence that there is such a custom we, find defendant No. 2 giving three instances where boys from other families were adopted in Goda Dattak even though members in the adoptive father 's family were present. It is true that the evidence does not show whether such adoptions from other family (1) C.A. No. 379 of 1958 decided on 15.9,61, 650 took, place only after members in the adoptive father 's family who might have been available for adoption declined to be adopted. It will be unreasonable however to expect such evidence as to the exact circumstances under which adoptions were made from other families even in the presence of members in the adoptive father 's family. But even if it be correct to say that the defendant has not established clearly that members from other families were adopted even though members in the adoptive father 's family were willing to be adopted, the fact remains that the plaintiff has not been able to establish by either any authoritative texts or from the opinion of some person well learned about the Goda Dattaka customs that a custom exists barring the adoption of members from other Vallabhacharya families if it were possible to adopt members from the adoptive father 's family. This brings us to the contention most vehemently urged before us that the evidence establishes an implied prohibition by Anniruddhalalji of the adoption of any person other than the plaintiff or one of his two sons. Reliance is placed first on the letter exhibit 115. We are inclined to agree with the High Court that this letter was written by Mahalakahmi Bahuji Maharaj of her own accord and cannot be brushed aside as having been written under the influence of the plaintiff. All that the letter shows however is that Anniruddhalalji had expressed a desire that Gokul Nath (who is plaintiff 's son) should be taken in adoption to him. While a reasonable reading of this letter would show that Anniruddhalalji authorized Mabalakshmi Bahuji Maharaj to make an adoption and that he expressed his preference for the adoption of Gokal Nath, the letter does not show even remotely that Anniruddhalalji indicated any wish that no body except Gokul Nath should be adopted. It is interesting to remember in this connection that plaintiff 's own in the Plaint is not that Anniruddhalalji had 651 declared any wish that nobody other than Gokul, Nath should be adopted but that his desire was that, "no body other than the 1 plaintiff or any one of hit sons should be adopted. " The plaintiff in his own testimony has no doubt said that Anniruddhalalji after asking the plaintiff to give his eldest son in Goda adoption told Mahalakshmi Bahuji Maharaj that ,only his brother 's son should be adopted". if, this was true it is difficult to understand why the plaintiff tried to make a case in the plaint that Anniruddhalalji had declared a wish that nobody except the plaintiff himself or one of his sons should be adopted. The plaintiff 's witnesses who have spoken as regards the declaration by Anniruddhalalji of his wish in this matter of adoption have not stated that Anniruddhalalji said that only his brother 's son should be adopted. His witness Nateswarji the brother of Anniruddhalalji 's, first wife says that "during his last illness Anniruddhalalji had spoken in my presence and in the presence of Defendant No. 1 that his desire was to adopt Bhaiya Raja and he had inquired of Defendant No. 1 what her desire was". Defendant No 1 had replied that her desire was the same as his desire. Such a talk had taken place only once in my presence. " Accepting that Nateshwarji has stated the full truth here his evidence does not show anything more than was indicated in the letter exhibit 115 itself and does not show that Defendant No. 1 prohibited even by implication the adoption of anybody else excepting Bhaiya Raja (the plaintiff 's son). The plaintiff 's witness Gobardhan stated in hip, evidence : Anniruddhalalji was speaking to all persons in touch with him that he wanted to take Bhaiya Raja in "Goda Dattak" and later that "he was spoken to by Maharaj that he wanted to take Bhaiya Raja in adoption". Even this witness who goes to the length of saying that a date was actually fixed by Anniruddhalalji for the adoption of Bhaiya Raja & story which none of the other witnesses give is not prepared to say that Anniruddhalalji said to Defendant No. 1 or to anybody else that nobody other 652 than Bhaiya Raj should be adopted. It is not possible in this state of the evidence to accept as true the plaintiffs uncorroborated testimony that Anniruddhalalji said to defendant No. 1, Mahalakshmi Bahuji Maharaj that only the plaintiff 's son should be adopted. We are therefore of opinion that the High Court is right in its conclusion that no implied prohibition by Anniruddhalalji of adoption of anybody other than the plaintiff or his sons has been proved. The last argument that the parties being governed by the Madras School of Mitakshara, the adoption is invalid in the absence of consent by the husband 's sapindas must be rejected, for the simple reason that the letter exhibit 115 and the evidence of the plaintiffs own witnesses justify the conclusion that in his life time Anniruddhalalji authorised Mahalakshmi Bahuji Maharaj to make an adoption after his death though at the same time indicating his preference for one particular boy. The necessity of consent of the husband 's sapindas would arise if the Madras School of Mitakshara law was applicable only where there was no authority from the husband. In the present case there was authority from the husband to adopt and so even if the rule of Orthodox Dattak adoption was applicable and Anniruddhalalji was governed by the Madras School of Mitakshara the question of any consent of husband 's sapindas does not arise at all. In the view we have taken of this argument it is unnecessary for us to consider whether the High Court was right in rejecting the application for amendment of the plaint that was made by th plaintiff in order to induce the High Court to consider this very argument. It is also not necessary for us to enter into the question on which some evidence appears to have been led 1 though no issue was framed, viz. whether Goda Dattak adoption is a mere variant 653 of the orthodox Dattak adoption or an affiliation altogether different from Dattak adoption. We therefore express no opinion on this question. The appeal is dismissed with costs. Appeal dismissed.

The first respondent on the death of her husband who was a descendant of the famous Vaishnava teacher Vallabhacharyaji and was possessed of certain Devattar properties belong to the Thakur of which be was the Shebait, adopted her sister 's husband as a son under the Goda Dattak Custom of adoption which prevailed amongst the Vallabhacharya community. The appellant who was the own brother of the deceased adoptive father contended inter alia that under the Goda Dattak custom a widow could not adopt her sister 's husband as a son to her husband, that the adoptee should belong to the family of the adopter and that the widow should obtain the ,consent of her husband 's sapindas for the adoption. Held, that the rule in Dattaka Mimansa against the adoption of the son of a woman who could not be married because of Viruddha Samandha relationship is recommendatory and even if the limitation of the orthodox Dattak adoption apply to Goda adoption there is no bar to the adoption of the wife 's sister 's husband. Abhiraj Kuer vs Devendra Singh, C. A. No. 379 of 1961 decided on 15 9 61, referred to. In the present case it has not been proved that under the Goda Dattak customs a custom existed barring the adoption of members of other Vallabhachari families if it were possible to adopt members from the adoptive father 's family. As in the present case there was authority from the husband to adopt the question of the consent of the sapindas of the ' husband did not arise even if he was governed by the Madras School of Mitakshara.

Appeal No. 401 of 1961. Appeal by special leave from the judgment and order dated May 24, 1961, of the Allahabad ' High Court in Civil Misc. Writ No. 846 of 1961. M. C. Setalvad Attorney General for India and J.P. Goyal for the appellant. C. B. Agarwala and C. P. Lal, for respondents Nos. 1 and 2. C. K. Daphtary, Solicitor General of India, R. K. Garg, section C. Agarwala, D. P. Singh and M. K. Ramamurthi, for respondents Nos. 3 to 13. September 20. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. This appeal, by special leave, is directed against the judgment of the, High Court of Allahabad dismissing a writ petition filed 720 by the appellant praying for the issue of a writ in the nature of mandamus directing the State of Uttar Pradesh and the District Magistrate, Meerut, not to give effect to the resolution passed in the meeting of the members of the Municipal Board, Pilkhuwa, dated February 6. 1961 and for the quashing of the proceedings of that day. The appellant was the President of the Municipal Board, Pilkhuwa, in January February, 1959. On January 4, 1959, a written notice of the intention to make a motion of no confidence in the President signed by nine members of the Board, including Ram Nath and Kesho Ram Gupta, was delivered to the District Magistrate, Meerut, in Pursuance of sub section (2) of s.87 A of the U.P. Municipalities Act, 1916 (U.P. Act II of 19 16), hereinafter called the Act. The District Magistrate, Meerut, duly convened a meeting of the Board on February 6, 1961. The appellant moved writ petition No. 367 of 1961 in the High Court on February 2, 1961, and questioned the validity of that notice. That petition was dismissed in limine on the same day. It was held that unless and until an order of removal is passed actually by the State Government there could not be any removal of a member or anything which would disentitle a member to take part in the proceedings of the meeting and that the application was also premature. The meeting of the Board took place on February 6, 1961. Mr. Agarwala, Munsif, Meerut, presided over the meeting all the ten members who were present, voted for the motion of no confidence and the Munsif declared the motion to, have been carried. The appellant, by his writ petition, desired the proceedings of the meeting to be quashed and the resolution expressing no confidence in the appellant be not given effect to by the state of U.P. an . ' the District Magistrate. 721 It was urged before the High Court that the MO notice of motion delivered to the District Magistrate was invalid and so were the proceedings of the meeting. Ram Nath and Kesho Ram Gupta who had signed the notice and also Raghunandan I?,;, Prasad who, along with them took part in the proceedings of the meeting and voted in support of the no confidence ' resolution, bad incurred, prior to January 4, 1961, disqualification under s.13 D (g) of the Act inasmuch as they were in arrears in the payment of municipal tax and other dues in excess of one year 's demand to which section 166 of the Act applied. The contention was that on account of the having incurred the aforesaid disqualification, they were disqualified from being members of the Board and, consequently, were not competent to exercise the rights of a member of the Municipal Board. The High Court held that Ram Nath had been proved to be in arrears in payment of house tax on February 6, 196 1, and that Kesho Ram Gupta and Raghunandan Prasad were not in arrears in payment of the Tehbzarai tax for the year 1959 60 and house tax respectively. It held that a member of the Board did not cease to be a member on his mourning the disqualification under s.13 D(g) and that he became disqualified merely to exercise office and to act as a member. The I earned Judges observed : "During the continuance of the dis qualification the person 's right to act as a member falls into a state of suspension. On removal of the disqualification the state of suspension disappears and his right to exer cise office as a member of the board revives unless he has been removed by Government from membership of the board under section 40 of the Act during the continuance of dis qualification. " Holding that the motion of no confidence was valid as it had been passed by the vote of nine members 722 who constituted the majority of more than half the total number of members of the Board, that being seventeen, and that those nine members of the Board being qualified and duly elected members of the Board, Ram Nath 's taking part in that meeting did not vitiate its proceedings in view of the provisions of sub section (2) of section 113 of the Act, the learned Judges dismissed the writ petition. The learned Judges did not consider the validity of the notice on merits as they were of opinion that the order on writ petition No. 397 of 1961 operated as res judicata, though in view of their opinion the notice of motion of no confidence would have been invalid if the name of Ram Nath be excluded from the signatories as in that case the number would be eight and so one short of the number required by the provisions of sub section (2) of section 87 A of the Act. The meeting held in pursuance of a bad notice would also have been invalid. The learned Attorney General, appearing for the appellant, has raised the following, contentions : (i) The order dismissing writ petition No. 397 of 1961 could not operate as res judicata as it had been dismissed mainly on account of its being premature and not on merits. (ii) A member of the Municipal Board, on incurring a disqualification under section 13 D, ceases to be a member of the Board so long as the disqualification exists and therefore he cannot act as a member of the Board for any purpose. (iii) Kesho Ram Gupta was also a disqualified member of the Board and the resolution of the Board dated February 6, 1961, holding that no Tehbazari tax was due from Kesho Ram Gupta and that the amount deposited by him under protest on February 9, 1961, be refunded. , was ultra vires the power of the Board which had no power to review or revise the imposition of tax. 723 (iv) Due to the disqualification incurred by Ram Nath and Kesho Ram Gupta, both the notice of motion of no confidence and the proceedings of the meeting were bad as, excluding their signatures and votes, the number of members signing the notice and of those voting at the meeting becomes less than half the total of the members of the Board. (v) The proceedings of the meeting were vitiated even if Ram Nath alone, who was a disqualified member, had taken part in the meeting and were not saved by the provisions of sub section (2) of a. 113, as the meeting held in pursuance of the provisions of section 87 A of the Act is not a meeting of the Board to which the provisions of sub section (2) of section 113 can apply. The learned counsel for the respondents conceded that the order dismissing writ No., 397 of 1961 could not operate as res judicata in ' these ,proceedings on the question whether the notice of no confidence was a valid notice or not. We do not agree with the second contention .for the appellant, or with the view expressed by the learned Judges that a person who incurs disqualification under cl. (g) of a. 13 D of the Act becomes disqualified to exercise office and to act as a member. Section 13 C of the Act lays down the qualifications for membership of the Board and section 13 D lays down the disqualifications for membership. Of its ten clauses, the relevant clause of section 13 D for our purpose is cl. It reads : "A person, notwithstanding that he is otherwise qualified, shall be disqualified for being chosen as, and for being, a member of a Board if he is in arrears in the payment of municipal tax or other dues in excess of one year 's demand to which section 166 applies". 724 Second proviso to this section is: " 'Provided further that in the case of (g), the disqualification shall cease as soon as the arrears are paid. " If a member of the board falls in arrears in the payment of tax, he incurs this disqualification. The provisions of section 13 D do apply to members of the board incurring disqualification during the period of their membership and are not confined in their application to the stage previous to the election as, in that case, the expression "and for being ' in the section would have been unnecessary. This expression has been interpreted in Election Commission, India vs Saka Venkata Subba Rao (1) in connection with the interpretation of article 191, whose relevant provision is "is person shall be disqualified for being chosen as, and for being, a member of the Legislative Assembly or Legislative Council of a State. . It was observed at page 1157 : "Article 191, which lays down the same set of disqualifications for election as well as for continuing as a member, and article 193 which prescribes the penalty for sitting and voting when disqualified, are naturally phrased in terms wide enough to cover both preexisting and supervening disqualifications. " There is nothing in section 13 D or in any other section of the Act which provides for the suspension or cessation from membership of a duly elected member on his incurring any of the disqualifications under section 13 D. On the other hand the provisions of section 40 of the Act lead to the inference that a member incurring such a disqualification, continues to be entitled to take part in any proceedings of the Board or to perform the duties of a member. Section 40 deals with the removal of members and empowers the State Government (1) ; 725 in the case of a city or the Prescribed Authority in any other case, to remove a member of the board on any of the grounds mentioned in cls. (a) to (f) of sub section The ground for removal mentioned in cl. (b) is that a member has incurred any of the disqualifications mentioned in Bs. 12 D and 13 D. Sub sections (3), (4) and (5) of section 40 read : "(3) The State Government may remove from the board a member who in its opinion has so flagrantly abused in any manner his position as a member of the board as to render his continuance as a member detrimental to the public interest: (4) Provided that when either the State Government or the Prescribed Authority, as the case may be, proposes to take action under the foregoing provisions of this section, an opportunity of explanation shall be given to the member concerned, and when such action is taken the reasons therefore shall be placed on record. (5) The State Government may place under suspension a member, against whom proceeding under sub sections (3)and (4) has been commenced, until the conclusion of the enquiry and any member who has been so suspended shall not so long as the order of suspension continues to remain in force, be entitled to take part in any proceedings of the board or otherwise perform the duties of a member. " The State Government is empowered to suspend a member against whom proceedings under sub section (4) had commenced, i.e., against whom action for removal is being taken on one of the grounds mentioned 'in cls. (a) to (f) of sub section A member so suspended is not entitled to take part in any proceedings of the board or otherwise perform the duties of a member during the period of suspension. It can be legitimately inferred from the provisions 726 of sub section (5) that in the absence of an order of suspension the member who had not only incurred any of the disqualifications mentioned in section 13 D, but against whom the Government might have started proceedings, was entitled to take part in the proceedings of the board or to perform the duties of a member so long as the Government does not place him under suspension. We are therefore of opinion that a member of the Municipal Board does not automatically come under suspension or lose his right to take part in the proceedings of the board or perform the duties of a member or cease to be a member of the board merely on his incurring any of the disqualifications mentioned in a. 13 D. It may be mentioned that any other conclusion can have very unstable effect and can indefinitely make the validity of the proceedings and action of the board uncertain as one cannot predicate at any moment of time as to which of the members of the board has incurred a disqualification, a matter which must be dependent mostly on the proof of the allegations made. Such could not have been the intention of the Legislature. Kesho Ram Gupta and Ragbunandan Prasad had incurred the disqualification under cl. (g) of section 13 D of the Act, they were not incompetent to exercise their rights as members of the board and could therefore validly sign the notice. , of motion of no confidence and take part in the proceedings of the meeting held in pursuance of the provisions of section 87 A of the Act on February 6, 1961. It follows that the proceedings of, and the resolution passed at the meeting of February 6, 1961, are valid and that the order of the High Court dismissing the appellant 's writ petition is correct, though for different reasons. In view of this opinion., it is not necessary to deal with the other contentions for the appellant. We therefore dismiss the appeal with costs. Appeal dismissed.

The appellant was the President of a Municipal Committee. A written notice of the intention to move a motion of no confidence in the President signed by nine members of the Board was delivered to the District Magistrate under section 87 A sub section (2)of the U.P. Municipalities Act, 1916. The District Magistrate duly convened a meeting of the Board, but before the date of the meeting the appellant moved a writ petition in the High Court and questioned the validity of the notice. The writ petition was dismissed in limine inter alia as being premature. The Meeting of the Board. was held on the due date and all the members present, voted for the motion of no confidence and the Munsif of the area who had presided declared the motion to have been carried. The appellant by his second writ petition before" the High Court desired that the 719 proceeding of the meeting be quashed and the resolution ex pressing no confidence in the appellant be not given effect to, by the State and the District Magistrate, for the reason that two of the members of the Board who had signed the notice and subsequently taken part in the proceedings of the meeting and voted, had 'incurred disqualification under section 13 D (g) of the U.P. Municipalities Act, 1916, inasmuch as they were in arrears in the payment of municipal tax and other dues to which section 166 of the Act applied. Held, that an order, dismissing a writ petition in limine not on merits but for the reason that it was premature. could not operate as res judicata in subsequent proceedings. does not automatically come under suspension, or lose his rights to take part in the proceeding of the Board, or perform the duties of a member or cease to be a member of the Board merely on his incurring any of the disqualification mentioned in section 13 D of the U.P. Municipalities Act, 1916. A member of the Municipal Board, merely, by incurring the disqualification under cl. (g) of section 13 D of the U.P. Municipalities Act, 1916, was not incompetent to exercise his rights as a member of the Board. Election Commission, India vs Saka Venkata Subba Rao, ; , referred to.

Appeal No. 76 of 1959. Appeal from the judgment and decree dated November 16, 1951, of the Madras High Court in Second Appeal No. 1656 of 1947. T. V. R. Tatachari, for the appellants. K. N. Rajagopal Sastri and T. Satyanarayana, for the respondent No. 1., 1961. September 22. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This is an appeal by a certificate granted by the High Court of Madras against its judgment and decree in Second Appeal 741 Suit No. 27 of 1939 filed by respondent 1 Gollapalli Ramalingamurthi against respondent 2 Immani Venkanna and his four sons appellants 1 to 4. The appellants and respondent 2 are members of an undivided Hindu family. The case for respondent 1 was that he had purchased the properties described ' in the Schedule attached to his plaint on April 1, 1936 in a sale held by the Official Receiver in the insolvency of respondent 2. A registered sale deed was accordingly issued in favour of respondent 1 (exhibit P. 4) on September 21, 1936. In pursuance of the said sale respondent 1 obtained possession and enjoyment of such properties after partitioning them with Rayudu, the brother of respondent 2. In October, 1938, however, the appellants and respondent 2 trespassed on the said properties and so respondent 1 had to file the present suit claiming a declaration of his title in regard to the said properties, and asking for their possession and for past and future mesne profits. That in brief is the nature of the suit from which the present appeal arises. The claim thus made by respondents 1 was resisted by respondent 2 and the appellants on several grounds. It was urged by respondent 2 that the transfer in favour of respondent 1 was benami and that respondent 1 was not the real owner of the properties. In support of this case respondent 2 gave, what according to him, was the antecedent history of the sale in favour of respondent 1. He alleged that he had sustained heavy losses in business conducted by him with the result that he was indebted to the extent of Rs. 25,000. Apprehending that the suit properties would be lost to the family at the instance of his creditors he and his junior mother in law Kanthamani Seshamma approached respondent 1 's father in law Suryaprakasa Sastrulu for advice and on his advice respondent 2 executed a collusive and nominal mortgage deed for Rs. 1,000 (exhibit P. 9) in favour of respondent 1 on June 16, 1933. Similarly, on the same advice a similar nominal transfer deed was executed in favour of respondent 1 on August 6, 1939, (exhibit P. 12) after the properties covered by the said document had been released from an earlier non possessory mortgage (exhibit P. II) which had been executed on July 21, 1930. Thus, according to respondent 2 the documents executed in favour of respondent 1 were nominal and collusive and were not supported by any consideration. Respondent 2 further alleged that the execution of the said collusive documents between him and respondent 1 came to the knowledge of some of his creditors and that led to an insolvency petition against respondent 2 by one of his creditors in 1.P. No. 91 of 1933. This petition was filed in the Court of the Subordinate Judge at Ellore on September 15, 1933, against respondent 2. In these insolvency proceedings respondent 2 was adjudicated insolvent and the Official Receiver, appointed to take charge of respondent 2 's properties, brought the said properties to sale subject to the aforesaid nominal mortgages in favour of respondent 1. Kanthamani Seshamma purchased the said properties with her own money but benami in the name of respondent 1 on condition that respondent 1 would reconvey the said properties to the family of respondent 2 whenever called upon to do so. The allegation of respondent 1 that he had obtained possession of the properties was denied, and it was urged that respondent 1 had no title to the properties and was entitled to no relief in the suit filed by him. That is the substance of the pleas raised by respondent 2 and the appellants joined respondent 2 in making the same pleas by their separate written statement. At the trial three issues were tried as preliminary issues; they were issues 5, 8 and 9. Issues 8, and 9 were in regard to the court fees payable on the claim made in the plaint and regarding the pecuniary jurisdiction of the Court. The Court found that it had jurisdiction to try the suit and it valued the subject matter of the suit at Rs. 2,411 7 2 on which additional court fees was paid by respondent 1. Issue 5 was as to whether the sale in favour of respondent 1 bound the shares of the appellants in the family properties. The learned trial judge answered this issue in favour of the appellants purporting to follow the Full Bench decision of the Madras High Court in Ramasastrulu vs Balakrishna Rao (1). According to the said decision the right of respondent 2 as the father of the appellants and manager of the undivided Hindu family to sell the shares of his sons for purposes binding on the family did not vest in the Official Receiver on his insolvency, and so the sale effected by the Official Receiver in favour of respondent 1 did not, and could not, in law bind the shares of the appellants in the properties conveyed. After these findings were recorded respondent 1 applied for the amendment of his plaint and the said amendment was allowed. By this amendment respondent 1 alleged that the suit properties were the self acquired properties of respondent 2 and so the appellants had no interest therein. On this alternative plea it was urged by respondent 1 that the properties sold by the Official Receiver to respondent 1 conveyed the entire properties which belonged to respondent 2 alone. In addition to this alternative claim made by an amendment respondent 1 also made an alternative prayer that he should be either given possession of the whole of the properties or 1/5th of the properties according as the properties are found to be separate properties of respondent 2 or are held to be properties of the undivided family consisting of respondent 2 and the appellants. These alternative grounds taken by respondent 1 by virtue of the amendment were traversed by respondent 2 and the appellants in their additional written statements.(1) I.L.R. 744 When the suit went to trial on the amended pleadings several issues were framed by the learned trial judge. In addition to the issues arising on the pleadings the learned trial judge framed suo motu one more issue 1(a), whether respondent 1 was the benamidar of the appellants, and if yes whether the appellants could be allowed to plead the same as a defence in the suit. The learned trial judge found that the suit properties were the joint family properties of respondent 2 and the appellants. Alternatively he held that even if they were originally the self acquired properties of respondent 2 they had been blended with the family properties and thus became the properties of the undivided family. He found that the shares of the appellants in the said properties did not vest in the Official Receiver and so were not conveyed to respondent 1. He came to the conclusion that the purchase by respondent 1 from the Official Receiver was only a benami transaction for the benefit of the appellants and that respondent 1 had not obtained possession of the properties at any time. According to the learned trial judge the sale in favour of respondent 1 was fraudulent and was brought into existence to defraud the creditors of respondent 2; and this fraud had been carried out and the creditors of respondent 2 had been defrauded. Since the fraud had been carried out, the learned judge held respondent 2 and the appellants could not be allowed to plead the same as a defence in the suit. As a result of this finding the learned judge passed a preliminary decree in favour of respondent 1 for 1/5th share in items 1 to 4 and 8 to 10 of the properties described in the Schedule attached to the plaint. In regard to items 5 to 7 on which the dwelling house of the family was constructed the learned judge held that respondent 1 was entitled to monetary compensation. Consistently with the preliminary decree thus passed as to the share of respondent 1 the learned judge 745 also directed that future mesne profits should be determined under O. 20, r. 12(c) of the Code of Civil Procedure. Against this decree respondent 1 preferred an appeal, No. 288 of 1943, in the Court of the Subordinate Judge,, West Godavari at Ellore. In this appeal he claimed that a decree should be passed in his favour in respect of the whole of the properties sold to him by the Official Receiver. The appellants filed cross objections and urged that the learned trial judge was in the error in framing issue 1 (a) suo motu and challenged his conclusion on it. The appellate Court agreed with the conclusions of the trial judge and so dismissed both the appeal and the cross objections. Against this appellate decree respondent I filed a Second Appeal, No. 1656 of 1947, and the appellants filed cross objections. This appeal came on for hearing before Mr. Justice Raghava Rao and it was urged before him that since the Provincial Insolvency (Amendment) Act No. 25 of 1948 which introduced section 28A had come into operation in the meanwhile retrospectively the decision of the Courts below that the Official Receiver could not in law have sold the appellant 's shares in the family properties could not longer be sustained. This contention was raised by respondent 1. It was met by the appellants by their counter contention that issue 1(a) had been sprung upon them as a surprise; it had been framed by the trial court after it had heard arguments on both sides and that the appellants had no opportunity to show that in fact the fraud contemplated by the parties had not been effectively carried out. They alleged that if the fraud had not been carried out the principle of estoppel invoked against them could not come into play. This contention raised by the appellants was accepted by the High. Court which called for a finding by the trial co art on issue 1(a), after giving both the parties an opportunity to adduce evidence on the 746 question about the completion or otherwise of the fraud connected with the benami purchase. After remand the trial court took evidence and made a finding that respondent 2 bad successfully played fraud on his creditors by getting the properties purchased by respondent 1 benami for his sons at the sale held by the Official Receiver. In due course this finding was submitted by the trial court to the High Court. Thereupon the appellants filed objections to the said finding. After this finding was received the second appeal was again placed for bearing by Mr. Justice Ragghava Rao. At the second hearing the appellants raised the point the amending Act by which section 28A was inserted in the Provincial Insolvency Act was ultra vires. The learned judge overruled the objections made by the appellants against the finding submitted by the trail court on the issue remanded to it and accepted that finding; but in view of the fact that the vires of the amending Act was challenged he thought it exp edient that the second appeal should be heared by a Bench of two judges. That is how the second appeal came before a division Bench of the Madras High Court for final disposal. In its final judgment the High Court has observed that the argument that Act 25 of 1948 was ultra vires was not pressed before the High Court, that certain other grounds were sought to be raised by the appellants but they were not allowed to be raised; so that in the result the main argument urged before the High Court was whether having regard to the fact that the fraud contemplated by respondent 2 and respondent 1 had been effectively carried out it was open to the appellants to plead that fraud against respondent 1 in respect of his claim for possession of the suit properties in the present suit. The High Court considered the conflicting decisions on this point and adhered to the view which has prevailed in the said High Court 747 since the decision in Vodiana Kamayya vs Gudisa. Mamayya (1) and held that the appellants and respondent 2 were estopped from setting up the fraud against respondent 1 in his present suit. In the result respondent 1 's claim in respect of the whole of the properties conveyed to him by the Official Receiver has been decreed. It is against this decree that the appellants have come to this Court with a certificate granted by the High Court and the principal point which has been argued before us on their behalf by Mr. Tatachari is that the High Court was in error in coming to the conclusion that in a case where both the transferor and the transferee ' were equal in fraud and where the fraud contemplated has been carried out it is not, open to the appellants to plead that fraud in defence against the claim made by respondent 1 to obtain possession of the properties conveyed to him benami by the Official Receive Mr. Tatachari contends that where the parties are equally guilty estoppel cannot be pleaded against the appellants and the estate must be allowed to remain where it rests. The point thus raised lies within a narrow compass and the material facts which give rise to it are no longer in dispute. The transaction in favour of respondent 1 is the result of a fraudulent plan to which both he and respondent 2 agreed. In was effected with the mutual consent of the vendore and the vendee to defraud the creditors of the vendor. That being so the transfer is not supported by any consideration and the transferee agreed to act as the benamindar until the transferor required him to reconvey the properties to his sons. The object intended to be achieved and the fraud initially contemplated by both the parties have been achieved and the creditors of respondent 2 have been defrauded. Possession of the properties, however, remained with respondent 2 and his sons the appellants; and in the present 748 section respondent 1 seeks to obtain possession of the properties on the ground that a deed of conveyance has been passed in his favour by the Official Receiver. Thus both the parties are confederates in the fraud and are equally guilty. Respondent 2 and the appellants seek to resist respondent 1 's claim to recover possession of the properties conveyed to claim on the ground that the conveyance is void having been effected for a fraudulent purpose which has been carried out. They urge that it has not been supported by any consideration and no title has passed in favour of the transferee. Respondent 1 sheets this challenge to his title by pleading that respondent 2 who participated in the fraud cannot be allowed to plead his own fraud in support of his refusal to part with the possession of the properties, and he urges that there is a conveyance duly executed in his favour on which the Court must act without permitting respondent 2 to challenge its validity. The High Court his upheld the plea of respondent 1 and has not allowed either respondent for the appellants to plead the fraud in support of their defence. Is this decision right? That is the question which falls to be decided in the present appeal. Reported decisions bearing on this question show that consideration of this problem often gives rise to what may be described as a battle of legal maxims. The appellants emphasised that the doctrine which is preeminently applicable to the present case is ex dolo malo non oritur action or ex turpi causa non oritur actio. In other words, they contended that the right of action cannot arise out of fraud or out of transgression of law; and according to them it is necessary in such a case that possession should rest where it lies in pari delicto potior est conditio possidenties; where each party is equally in fraud the law favors him who is actually in possession, or where both parties are equally guilty the estate will lie where it falls. On the other hand, respondent 1 argues that the proper maxim to apply is nemo allegans suam turpitudinum audiendumest, 749 whoever has first to plead turpitudinum should fail; that party fails who first has to allege fraud in which he participated. In other words, the principle invoked by respondent 1 is that a man cannot plead his own fraud. In deciding the question as to which maxim should govern the present case it is necessary to recall what Lord Wright, M. ' R. observed about these maxims in Berg vs Sadler and Moore (1). Referring to the maxim ex turpi causa non oritur actio Lord Wright observed that "this maxim, though veiled in the dignity of learned language, is a statement of a principle of great importance; but like most maxims it is much too vague and much too general to admit of application without a careful consideration of the circumstances and of the various definite rules which have been laid down by the authorities". Therefore, in deciding the question raised in the present appeal it would be necessary for us to consider carefully the true scope and effect of the maxims pressed into service by the rival parties and to enquire which of the maxims would be relevant and applicable in the circumstances of the case. It is common ground that the approach of the Court in determining the present dispute must be conditioned solely by considerations of public policy. Which principle would be more conducive to, and more consistent with, public interest, that is the crux of the matter. To put it differently having regard to the fact that both the parties before the Court are confederates in the fraud, which approach would be less injurious to public interest. Whichever approach is adopted one party would succeed and the other would fail, and so it is necessary to enquire as to which party 's success would be less injurious to public interest. Out of the two confederates in fraud respondent 1 wants a decree to be passed in his favour and that means he wants the active assistance of the Court in reaching the properties possession of (1) , 162. 750 which has been withheld from him by respondent 2 and ' the appellants. if the defense raised by the appellants is shut out respondent 1 would be entitled to a decree because there is an ostensible deed of conveyance which purports to convey title to him in respect of the properties in question; but, in the circumstances ', passing a decree in favour of respondent 1 would be actively assisting respon dent 1 to give effect to the fraud to which he was a party and in that sense the Court would be allowed to be used as an instrument of fraud and that is clearly and patently inconsistent with public interest. On the other hand, if the Court decides to allow the plea of ' fraud to be raised the Court would be in a position to hold an enquiry on the point and determine whether it is a case of mutual fraud and whether the fraud intended by both the parties has been effectively carried out. If it is found that both the parties are equally guilty and that the fraud intended by them has been carried out 'the position would be that the party raising the defence is not asking the Court 's assistance in any active manner; all that the defence suggests is that a confederate in fraud should not be permitted to obtain a decree from the Court because the document of title on which the claim is based really conveys no title at all It is true that as a result of permitting respondent 2 and the ' appellants to prove their plea they would incidentally be assisted in retaining their possession; but this assistance is of a purely passive character and all that the Court is doing in effect is that on the facts proved it proposes to allow possession to rest where it lies. It appears to us that this latter course is less injurious to public interest than the former. There can be no question of estoppel in such a case for the obvious reason that the fraud in question was agreed by both the parties and both parties have assisted 'each other ' in carrying out the fraud. When it is said that a person cannot 751 plead his own fraud it really means that a person cannot be permitted to go to a Court of Law to seek for its assistance and yet base his claim for the Court 's assistanceon the ground of his fraud. In this connection it would be relevant to remember that respondent 1 can be said to be guilty of a double fraud; first he joined respondent 2 in his fraudulent scheme and participated in the commission of fraud the object of which was to defeat the creditors of respondent 2, and then he committed another fraud in suppressing from the Court the fraudulent character of the transfer when he made out the claim for the recovery of the properties conveyed to him. The conveyance in his favour is not supported by any consideration and is the result of fraud; as such it conveys no titile to him. Yet, if the plea of fraud is not allowed to be raised in defence the Court would in substance be giving effect to a document which is void ab initio. Therefore, we are inclined to hold that the paramount consideration of public interest requires that the plea of fraud should be allowed to be raised ' and tried, and if it is upheld the estate should be allowed to remain where it rests. The adoption of this course, we think, is less injurious to public interest than the alternative course of giving effect to a fraudulent transfer. This question has been the subject matter of judicial decisions in most of our High Courts; and it appears that the consensus of judicial opinion with the exception of the Madras High Court is in favour of the view which we have taken. In Bombay the principle that in dealing with a contest between two participants in fraud possession should be allowed to remain where it rests appears to have been consistently accepted until Chief Justice Sir Lawrence Jenkins struck a note of dissent in Sidlingappa Bin Ganeshappa vs Hirwa Bin Tukasa (1). Thereafter the correctness of (1) (1907) 1.L. R. 752 this judgment was sometimes doubted in the subsequent decisions of the said High Court [Vide : Lakshman Balvant Khisti V. Vasudev Mohoniraj Pande(1)] and finally the Full Bench of the said High Court reversed the said decision of Sir Lawrence Jenkins in Guddappa Chikkappa Kurbar vs Balaji Ramji Dange (2). Since then the decision of the Full Bench has been consistently followed in the Bombay High Court. The same view has been accepted by the Calcutta, Allahabad, Nagpur and Patna High Courts [Vida : Preomath Koer vs Kazi Mahomed Shazid(3).Emperor vs Abdul Sheikh(4), Vilayat Husain vs Misran (5), Nawab Singh vs Daljit Singh (6), Qader Baksh vs Hakim (7), Bishwanath g/o Karunashanker Shukla vs Surat Singh alias Chhuttu Singh s/o Bhabhut Singh (s), and J. C. Field Electric Supply vs K. Agarwala (9) (Case of illegal contract)]. In Madras the earlier decisions of the High Court appear to have, taken the same view [Vide: Venkataramana vs Viramma (10), Yaramati Krishnayya vs Chundru Papayya (11) and Raghavalu Chetty vs Adinarayana Chetty (12)]. In the case of Vodiana Kamayya vs Gudisa Mamayya (13), however, a Division Bench of the Madras High Court upheld the view that a person who has conveyed property benami to another for the purpose of effecting a fraud on his creditors cannot, where the fraud has been effected, set up the benami character of the transaction by way of defence in a suit by the transferee for possession under the conveyance. Since then this view has prevailed in the Madras High Court [vide : Keppula Kotayyar Naidu vs Chitrapu Mahalak8hmamma (14) and Muthu K. R. A. R. P. L. Arunarhalam Chettiar vs Bangaswamy Chettiar (1.5)]. In our opinion (1) (2) I. L. R (3) (1903 4) 8 C. W. M. 620.(4) A. I. R. (5) All. 396.(6) (1936) 1.L. R. 58 All. 842.(7) (1932) 1.L. R. 13 Lab.(8) A.I. R. 3.(9)(1951) 1.R. 30 Pat.(10) (1887) 1.L. R.10 Mad.(11) (1 897) 1.L. R. (12) (1 909) 1.L. R. (13) (14) Mad.(15) Mad.753 the view taken by these subsequent decisions of the Madras High Court does not represent the true and correct approach to the question. In this connection we may incidentally refer to the observations made by the Privy Council in T. P. Petherpermal Chetty vs R. Muntandi Servai. In that case the Privy Council has no doubt dealing with the question on the basis that the purpose of the fraudulent conveyance had been defeated and so different principles naturally came into play. While discussing the problem in its broad aspect, however, Lord Atkinson, who delivered the judgment of the Board, cited with approval the observations made in Mayne 's Hindu Law which clearly support the view that we have taken. Says Mayne: 1 'The, fact that A has assumed the name of B in order to cheat X can be no reason whatever why a Court should assist or permit B to cheat A. But if A requires the help of the Court to get the estate back into his own possession, or to get the title into his own name, it may be very material to consider whether A has actually cheated X or not. If he has done so by means of his alias, then it has ceased to be a mere mask and has become a, reality. It may be very proper for a Court to say that it will not allow him to resume the individuality which he has once cast off in order to defraud others. If, however, he has not defrauded any one there can be no reason why the Court should punish his intention by giving his estate away to B, whose roguery is. even more complicated than his own This appears to be the principle of the English decisions. But where the fraudulent or illegal purpose has actually been effected by means of the colorable grant then the maxim applies In pari delicto potior est conditio possidentis. The Court will help neither party and let the estate lie where it falls (2)". Lord Atkinson has observed that this statement of the law is correct and in that sense (1) (1908) L. R. 35 1.A. 98.(2)Mayne 's Hindu Law, 7th Ed,p.595 para 446(35 I.A.p 102) 751 the view that we have taken may be said to be consistent with the opinion expressed by the Privy Council by approving the statement of the law made by Mayne. In support of the contrary view reliance is usually placed on an early English decision in Doe, Dem.Roberts against Roberts, Widow (1). In that case it was held that "ro man can be allowed to allege his own fraud to avoid his own deed; and, therefore, where a deed of conveyance of an estate from one brother to another was executed, to give the latter a colorable qualification to kill game. The document was as against the parties to it valid and so sufficient to support an ejectment for the premises". In dealing with the question raised Bayley, J. observed "by the production of the deed, the plaintiff established a prima facie title; and we cannot allow the defendent to be heard in a Court of Justice to say that his own deed is to be avoided by his own fraud;" and Holroyd, J., added that " 'a deed may be avoided on the ground of fraud, but then the objection must come from a person neither party nor privy to it, for no man can allege his own fraud in order to invalidate his own deed". This decision has, however, been commented on by Taylor in his "Law of Evidence". According to Taylor "it seems now clearly settled that a party is not estopped by his deed from avoiding it by proving that it was executed for a fraudulent, illegal or immoral purpose (2)". The learned Author then refers to the case of Roberts (1) and adds "in the subsequent case of Prole vs Wiggins (3) Sir Nicholas Tindal observed that this decision rested on the fact that the defence set up was inconsistent 'with the deed". Taylor then adds that ",the case, however, can scarcely be supported by this circumstance, for in an action of ejectment by the grantee of an annuity to recover premises. (1) (2) Taylor 's "Law of Evidence", Vol.I, 11th Ed.p. 97, paragraph 93.(3) 35; ; 43 R. R. 621.755 on which it was secured, the grantor was allowed to show that the premises were of less value than the annuity, and consequently, that the deed required enrollment, although he had expressly covenanted in the deed that the premises were of greater value. . . According to the learned author "the better opinion seems to be that where both parties to an indenture either know, or have the means of knowing, that it was executed for an immoral purpose, or in contravention of a statute, or of public policy, neither of them will be estopped from proving those facts which render the instrument void ab initio; for although a party will thus in certain cases be enabled to take advantage of his own wrong, yet this evil is of a trifling nature in comparison with the flagrant evasion of the law that would result from the adoption of an opposite rule" (P. 98). Indeed, according to Taylor, although illegality is not pleaded by the defendant nor sought to be relied upon by him by way of defence, yet the Court itself, upon the illegality appearing upon the evidence, will take notice of it, and will dismiss the action Ex turpi causa non oritur actio. No polluted hand shall touch the pure fountain of Justice" (P. 93). To the same effect is the opinion of Story:(1) "In general, where parties are concerned in illegal agreements or other transactions, whether they are mala prohibita or mala in se, Courts of Equity following the rule of law as to participators hi a common crime will not interpose to grant any relief, acting upon the known maxim In pari delicto potior est conditio defendentis et posidentis The old cases often gave relief, both at law and inequity, where the party would otherwise derive an advantage from his inequity. But the modern doctrine has adopted a more severely just and probably politic and moral rule, which is to leave the parties where it finds them giving no relief and no countenance to claims of this sort" '. (1) Story ' s Equity Jurisprudence, Vol.I. section 421; English edition by Randell, 1920, section 298.756 In judicial decisions where this question has been considered a passage from the judgment of Lord Mansfield, C. J., in Holman vs Johnson (1) is often quoted. If we may say so with respect the said passage very succinctly and eloquently brings out the true principles which should govern the decision of such cases. Said Lord Mansfield, C. J., "the objection that a contract is immoral or illegal as between plaintiff and defendant sounds at all times very ill in the mouth of the defendant. It is not for his sake, however, that the objection is ever allowed; but it is founded in general principles of policy which the defendant has the advantage of, contrary to the real justice, as between him and the plaintiff, by accident, if I may say so. The principle of public policy is this ex dolo malo non oritur actio. No Court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act. If, from the plaintiff 's own stating or otherwise the cause of action appears to arise ex turpi causa or the transgression of a positive law of this country, there the court says he has no right to be assisted. It is upon that ground the Court goes; not for the sake of the defendant, but because they will not lend their aid to such a plaintiff". On behalf of the respondents it was urged that the principles on which the appellants rely are applicable to contracts and not to conveyances. A conveyance, it is argued, rests on a different basis from a contract, and so the English decisions cannot be pressed into service by the appellants. We are not impressed by this argument. Even if respondent 1 has based his case on a conveyance the position still remains that as a result of the facts proved by respondent 2 and the appellants the conveyance is void ab initio. It is a document fraudulently executed and as such it conveys no title to the transferee at all. That being so we do not think that in giving effect to the considerations of (1) (1775) 1 Cowrer 341.757 public interest or policy it makes any difference that the deed on which the present suit is brought is one of conveyance. It is then contended that in deciding the point raised by the appellants we must look to the provisions of section 84 of the and nothing else. The is a comprehensive code and it is only in cases failing under section 84 that it would be permissible to the Court to apply the equitable principles or to invoke considerations of public policy as the appellants purport to do. Section 84 provides that where the owner of property transfers it to another for an illegal purpose and such purpose is not carried into execution, or the transferor is not as guilty as the transferee, or the effect of permitting the transferee to retain the property might be to defeat the provisions of any law, the transferee must hold the property for the benefit of the transferor. We do not see how this section is material or can give any assistance in the decision of the point before us. In the present case the transferee is not in possession of the properties and the present case is not one of the three categories of cases contemplated by the section. If the argument assumes that the only cases where equitable principles can be invoked are cases falling under section 84 and section 84 is exhaustive in that sense, we have no difficulty in rejecting the said argument. Since the present case is entirely outside section 84 it inevitably falls to be considered on considerations of general policy, and as we have already held, judged in the light of such considerations it must be held that the public interest would be less injuriously affected if the property is allowed to remain where it lies. Therefore, we must hold that the High Court was in error in not giving effect to the finding recorded by the trial court that the fraud mutually agreed upon and contemplated by respondents 1 and 2 had been effectively carried out and that in the 758 carrying out of the fraud both the parties were equally guilty. The appeal must, therefore, be allowed and the suit instituted by respondent 1 must be dismissed. In the circumstances of this case we direct that the parties should bear their own costs, throughout. Appeal allowed.

The conveyance in suit was the result of a collusive plan between respondent 1 and respondent 2 to defraud the latter 's creditors. The agreement was that respondent 1 was to act as the benamidar for respondent 2 and his sons, the appellants. The fraud succeeded and the creditors of respondent 2 were in fact defrauded. Thereafter respondent 1 brought the present suit for declaration of title and recovery of possession against respondent 2 and the appellants on the basis or the conveyance. The latter resisted the suit on the ground that the conveyance was fraudulent, unsupported by consideration and passed no title. The High Court in second appeal held that the appellants and respondent 2 were estopped from pleading fraud in the suit and decreed the same. The question was whether the view taken by the High Court was correct and the ostensible owner was entitled to a decree. Held, that there could be no question of estoppel in a case where both the parties were guilty of fraud. 740 Where in a case, such as the present, one of the confederates in fraud seeks a, decree on a conveyance that resulted from such faud and the other takes plea 'of fraud in defence, the matter has to be decided on considerations of public policy. Since one of the parties must succeed in any event, the proper approach for the Court to adopt would be the one that was less injurious to public interest, namely, to allow the plea of fraud to be raised in defence and, if upheld, allow the properties to remain where they were, than to decree a suit based on a fraudulent claim. It could make no difference in such a case if the suit was based on a deed of conveyance and not a contract. Vodiana Kamayya vs Oudisa Kamayya, (1917) 32 M.J.J. 484, Kepula Kotayyar Naidu vs Chitrapur Mahalakshmama, Mad. 646 and Mutho K.B.A.R.P.L. Arunachalam Chettiar vs Rangaswamy Chettiar, Mad. 289, disapproved. Berg vs Sadler and Moore, , T. P. Petherperumal Chetty vs B. Muniandi Servai, (1908) L.R. 35 I.A. 98 and Holman vs Johnson, (1775) 1 Cowper, 34 1, referred to. Deo, Dem. Roberts against Roberts, Widow, (1819) 106 E. R. 401, considered. Case law reviewed. Section 84 of the is not exhaustive in its provisions and since the present case falls outside of that section, it has to be decided on considerations of general policy.

80, 80A. 81 and 116 to 213 of 1960. Petitions under article 32 of the Constitution of India for enforcement of Fundamental Rights. section V. Gupta, M. C. Bhandare, section N. Andley, Rameshwar Nath and P. L. Vohra, for the petitioners. H. N. Sanyal, Additional Solicitor General of India, D. N. Mukherjee and P. D. Xenon, for the respondents. Porus A. Mehta, J. R. Gagrat, and G. Gopalakrishnan, for the interveners. August 11. The judgment of Gajendragadkar, Hidayatullah, Shah and Raghubar Dayal, JJ., was delivered by Hidayatullah, J., Subba Rao,:J., delivered a separate judgment. 112 HIDAYATULLAH, J ' These writ petitions raise identical questions, and a common argument was addressed to the Court in all of them. Petitions Nos. 80 and 80A of 1960 have been filed by two petitioners. One petitioner holds a permanent ' licence and the other, a temporary licence renewable triennially, to work as Dalal 's at New. Customs House, Bombay. In the other petitions also, petitioners Nos. 1 to 50 hold permanent licences, and petitioners Nos. 51 to 99 hold temporary but renewable licences. Some of the permanent licences were issued in 1936, and some of the temporary licences were issued as far back as 1944. These licences, whether permanent or temporary, were issued under s.202 of the , prior to its amendment by the Sea Customs 'Amendment) Act, 1955 (Act 21 of 1955). They were issued after a brief enquiry and subject to the fulfilment by the applicant of the following conditions : "(1) He must produce at least 2 certificates of character each from a Justice of Peace or other persons of known respectability. (2) He must certify that he has not been convicted of any criminal offence. (3) He must declare that he will have no claim to any accommodation in the Custom House. (4) He must also give a security of Rs. 2000 in cash or Government paper having an equivalent market value and execute a Bond for Rs. 2000 on It fifteen rupees Stamp Paper in the attached form. " In 1955, by the amending Act, s.202 was substituted by another section. The section now reads : "202. (1) With effect from such date as the Central Government may, by notification in the Official Gazette specify, no person shall act as an agent for the transaction of any business relating to the entrance or 113 clearance of any vessel or the import or export of goods or baggage in any Custom house unless such person holds a licence granted in this behalf in accordance with the rules made under sub section: (2). (2) The Chief Customs authority may make rules for the purpose of carrying out the provisions of this section and in particular such rules may provide for (a) the authority by which a licence may be granted under this section and the period of validity of any such licence; (b) the form of the licence and the fees payable therefor; (c) the qualifications of persons who may apply for a licence (d) the :restrictions and conditions (including the furnishing of a security by the licensee) for his faithful behaviour as regards the custom house regulations and officers) subject to which a licence may be granted ; (e) the circumstances in which a licence may be suspended or revoked; and (f) the appeals, if any, against an order of suspension or revocation of a licence, and the period within which such appeals shall be filed. " As A result of the enactment of this section, the original licence, whether permanent or temporary. would have become ineffective after. the date to be specified by the Central Government. It became necessary for the petitioners and others to apply for licences granted in accordance with the rules framed under sub section These rules were framed, and public notices were issued. inviting applications ; but the dates were postponed 114 till the rules were published in the Gazette on May 14, 1960. It is not necessary to refer to the prior history of these rules and to the many representations that were made, as they are not relevant. On June 18 1960, a public, notice (No. 87) was issued fixing June 25, 1960 as the last date for making applications for the new licences, and the persons affected were informed that the. operation of the new licences under the rules would commence on July 14, 1960. On June 27, 1960, Writ Petitions Nos. 80 and 80A of 1960 were filed, followed by Writ Petitions Nos. 81 and 116 to 213 of 1960 filed on July 12 1960. An ex parte ad interim stay of the revocation of the existing licences was obtained from this Court, and subsequently, the respondents undertook to issue to the petitioners special temporary licences renewable yearly till the disposal of these petitions. Prior to the. Custom House Agents Licensing Rules, 1960, there were four classes of Agents. They were (1) Clearing Agents, (2) Dalals., (3) Muccadams and (4) Baggage Clearing Agents. According to the petitioners, there were, 100 licensed Clearing Agents, 200 licensed Dalals, 270 Muccadams and about 15 Baggage Clearing Agents. The duties and functions of these four classes of agents were different. Whether these distinctions were always maintained and whether they grew out of regulations or usage is hardly necessary to enquire. By the Rules of 1960, these classes were merged into one, and all licensed agents were placed on an equal footing. In other words, there is to be hereafter one class of agents ' Though the petitioners holding "permanent ' licences and the petitioners holding 'temporary" licences with a term to run out have relied upon the fact that their licences are still valid, there was no serious attempt to deny that under section 202(1) they would be rendered ineffective after the date to be fixed by Government. The "permanent ' licences 115 also are not in a favourable position in this regard. If the first sub section requires that fresh licences to work as Custom House Agents be obtained, the distinction between permanent and temporary licences ceases to be material. No part of s.202 was challenged as being void or ultra vires. In these petitions, only the Rules &ire challenged as in breach of the fundamental rights under articles 14 and 19 of the Constitution and Also as being in excess of the rule making power conferred by sub section (2) of section 202. Form prescribed under the Rules for taking security from the approved agents is also questioned as being in excess of the power to make rules and contrary, in certain respects, to the itself. It may be mentioned that the petitioners in all the Writ Petitions are Dalals; but at the hearing, certain Clearing Agents obtained permission to intervene, and were also heard. Since the , ' in general and section 202, in particular were. not challenged in the petitions, we must start with the premise that the authority to insist , on fresh licences under the Rules in the case of all the operators was properly exercised. The first question to consider is whether the Rules, speaking generally, were validly framed and the next question to consider is whether any of the. Rules individually challenged goes beyond the , or offends against the Constitution. In questioning the Rules generally, the petitioners submit that these Rules could only be framed for the purpose of carrying out the purposes of s.202 [ provide sub section (1) ], or, to provide for the, matters 'mentioned in cls. (a) to (f) of section 202(2). Some of the Rules. it is submitted, go beyond the general purpose of the section, which is to license agents and the special 'topics mentioned there, and seek to further some of the purposes of other parts of the Act. Mention in this connection 116 is made specially of Form 'O ' prescribed by the Rules, under which the agents personally and the security furnished by them have been made liable for short collection of Customs duty, etc. The question whether the agents are liable, in any event,. for such short collection under section 39 is a question, which will have to be examined on merits separately, but for repelling the argument in its present from, it is sufficient to say that it is robbed of all its force by a. 9 of the . under section 202(2), the Chief Customs authority is empowered to make rules for the purposes of t hat section. That purpose is the licensing of agents and the regulation of their conduct and functions. But the Chief Customs authority is also empowered by section 9 to make rules consistent with the " 'generally to carry out the provisions of this Act". The power to make rules under section 202 is not the only power which the Chief Customs authority can exercise, and it is only too clear that power can also be derived from section 9, if there be need. Thus, if it is necessary that the agents must carry out certain provisions of the Act, a rule can be made in the exercise of the two powers together. Though the impugned Rules are headed as framed under s.202 of the ., they cannot be questioned, if they carry out not only the special purposes of s.202 but also certain other purposes of the Act, because the two powers will concur to sustain them. It is only when a rule or rules are pointed out, which subserve neither the special purpose of the section nor the general purposes of the Act that they can be successfully questioned. In short, therefore, the petitioners ' case on the individual Rules alone remains to consider. The first contention is that under the impugned Rules, the number of licences to be granted at the Customs House can be limited by the Customs. collector, and that applications can only be made, if the Customs collector publishes a notice inviting 117 applications. This restriction, it is contended, is unconstitutional, as it interferes with the right of all the petitioners to carry on their profession or a vocation freely as contemplated, by Art, 19. The Rules bearing upon these matters are rr.4 and 8. The latter Rule says that the number of licences to be granted would be fixed by the Customs collector, having regard to the volume of import and export business transacted through the Customs House, and the number is capable of being revised from time to time. The former empowers the Customs collector to invite applications, as and when he considers it necessary. It cannot be said that the Rules are not designed to advance public interest, because even a processions or trade has sometimes to be limited in the public interest, When we pointed out to Mr. Gupta that this kind of limitation on the number of persons allowed to hold licences is common, as, for example, porters in a railway station, taxicab drivers and so on, he stated that at least during the transitional period, the old operators might have been given licences on production of proof that they held licences previously. The argument is really not one based upon the interests of the public but upon the interests of the present holders of the licences. Public interests in the context must override private interests. It cannot be said that all the present operators are equally desirable, and if their number exceeds the requirement of the Customs House, it is obvious that some retrenchment in their numbers may legitimately be made, Every one has an equal chance of applying for the. existing vacancies, but he must stand in. competition with the others. There is no limitation on the number of applications that can be made, and thus, every operator will get ' a chance to have his case examined. It is to be expected that the most exprienced and the most efficient will get preference, and. no claim can be made on behalf of the incompetant and the inefficient that they should 118 receive equal treatment. Once the number is limited to the requirements of the business, it is manifest that the Customs collector will invite applications only, as and when occasion demands. These Rules, in our opinion, cannot be said to ' offend against the Constitution. The next contention is about rr.6(a), (b) and (c), which require the applicant to furnish to the Customs collector satisfactory evidence as to his respectability, reliability and financial status, and that he would be in a position to muster sufficient clientele and business in the event of his being granted the licence. The applicant has also to furnish an income tax clearance certificate. These conditions are challenged as being unreasonable restrictions upon the right to carry on a profession or avocation. Serious attempt was not made to establish that the condition about respectability and reliability was unconstitutional. It was, however, pointed out that evidence about financial status created a class barrier between the rich and the poor and only the rich were to be preferred. By the words financial status" is not meant that the applicant must be a wealthy person; what is required is that he should not be financially embarrassed, and proof that he is in easy circumstances. It is obvious that the agents under the Act deal with vast sums of money and valuable articles, and it may be necessary to scrutinise the financial position the applicant to find out whether or not he would be exposed to temptations. A person heavily indebted or insolvent cannot be trusted in the same way as a person who is not so embarrassed, and an enquiry into financial status is so much in the public interest, that we cannot say that the condition must necessarily be unreasonable. Similarly, the argument. that new entrants would find it difficult to assure that they would have sufficient clientele and business and would thus be discriminated against, is not correct. The Customs House is not a place where persons can allowed to learn a 119 profession or to take a chance. The movement of goods, the due performance, of the duties and functions under the and observance of the regulations are not easy matters for a person, who is not sufficiently experienced and who has not got the backing of a certain amount of business and the experience which such business affords. It may be necessary for a person to apprentice himself for some time to get to know the importers and exporters, and to prove to the Customsauthority that by reason of his apprenticeship and his business connections lie would be in a position to handle the work in the Customs House from the moment he is licensed. The Rule is designed to avoid entry into the Customs House premises of persons who, being there, are unable to do business, and merely add to the number of persons present. The last condition is the production of an income tax clearance certificate. The petitioners rely upon a decision of the Madras High Court reported in K. Raman and Co. vs State of Madras (1). In that case, it was hold that the fact that a person was in arrears of income tax was not germane to the issue of a licence under the Yarn Dealers Control Order, and that the insistence on the production of an income tax clearance certificate was extraneous to the carrying on of the business. The position of an agent who handles other persons ' moneys and goods is different from that of a dealer who deals with goods on his own behalf. As part of an enquiry into an applicant 's respectability, reliability and financial status, an enquiry can also be made to see whether he has discharged his debts to the State. If a person is liable to income tax and pays it punctually, he would have no difficulty in proving it. If, however, for some good reason the payment has been delayed, there would be nothing to prevent. him from proving it. (1) A.I.R. 1953 Mad '. 8A. 120 insistence upon the production of the certificate is, in our opinion, connected with the enquiry into his respectability and financial status. to find out if he can be trusted with other persons ' money and goods. The next Rule which is questioned is r. 9, which provides for an examination of the applicant. This examination follows a scrutiny of the application under the other Rules, and embraces questions on various subjects. The duties of the agents require them to handle goods, and the examination is designed to find out whether a candidate knows the elements of the law relating to the arrival, entry and clearance of vessels and goods. Objection is not raised to the examination as a whole but only to cl. (p) of r. 9 (2) under which a candidate is supposed to know the procedure in the matter of refund of claims, appeals and revision petitions under the . It is contended that these are matters in which an agent is not interested as an agent, but are matters for the owner and the Castoms authorities to know. It is true that the curriculum for the examination is somewhat extensive ; but it is also, clear that what is expected of the candidate is knowledge, not necessarily exhaustive but sufficient, of the laws relating to the arrival, entry and clearance of vessels and goods. We do not think that it is wrong for the. authorities to insist upon at least a working knowledge of the laws applicable to the kind of work the agents are required to do. When licences are issued under other laws, a candidate is sometimes required to answer questions relating to the law under which the licence is issued. One well known example is the questioning of a candidate about the rules of the road when he is issued a licence to drive a mechanically propelled vehicle. These Rules advance efficiency, and the additional know, ledge about refunds, appeals and revisions under the Act may be necessary where an agent handles 121 goods of a principal, who is himself not present to file appeals or revisions or to claim refunds. The Rule, in our opinion, is perfectly valid. Rule 10 is the next subject of attack. It provides that the Customs collector shall reject an application, for the grant of a licence (a) if the candidate fails to pass the examination, or (b) the number of vacancies do not justify the grant of such licence, or (c) the applicant is not otherwise considered suitable. Objection is taken to cl. It is said to confer a very wide discretion on the Customs collector, and reference is made to sub r.(2), in which it is provided that no appeal shall lie from the order. of the Customs collector rejecting an application. It is further pointed out that in July, 1960, the Rules were amended by the addition of r. 25, under which an appeal is to lie to the Chief Customs authority against every order of the Customs collector (i) rejecting an application for the renewal of a licence granted under these Rules; (ii) rejecting a fresh application made in accordance with r. 17 ; and (iii) refusing the grant or renewal of a special temporary licence under r. 24. It is argued that even though an appeal has been provided for these matters. , no appeal has been provided for the rejection under r. 10(1)(c). No doubt, other reasons may exist for rejecting the application of a candidate, as for example, when he is found to be a leper or an epileptic ; but one would expect that an order of this kind would ' be backed by reasons to be recorded in writing. It must be remembered that there is first a scrutiny of the application and an enquiry into the respectability, reliability and financial status of the candidate. follows an examination, If a ' candidate satisfies 'all the above condition 's, there would hardly be any ground left. for rejecting his application, except probably his physical unfitness to. the work, The Rule which: is framed is so gel general that it leaves to discretion of the 122 Customs collector to reject a. candidate for a trumpery reason (which he need not state), even though the candidate may be otherwise suitable. In out opinion, if a candidate is found fit under the other Rules and has successfully passed the examination, he should only be rejected under a rule which requires the Customs collector to state his. reasons for the rejection, and the rules must provide for an appeal against that order, as they do in the other cases. As the Rule stands, it cannot be considered to be a reasonable restriction upon the right of the successful candidate to carry on his avocation. The next Rule which is questioned is r. 11, which enjoins the payment of a fee of Rs. 50 both for a fresh application as well as renewal of the licence. In so far as the fee for the grant of a licence in the first instance is concerned, it cannot be said that the charge is exorbitant. It is not disputed that a fee is an amount collected to reimburse the Government for the expenses of licensing. It must reasonably be measured against the cost which may be entailed in the process of granting licences. In the initial stage, the Customs authorities have to scrutinise applications, subject the candidates to an examination, and provide them with licences to carry on their work. A fee of Rs. 50 initially may not be considered unreasonable, regard being had to the services involved. The same, however, cannot be said in the case of renewals. It is pointed out in the petition that formerly the charge was only 50 nP. It is averred in the petition that all that the licensing authority does, is to make an endorsement on the licence that it is renewed for a further period. It has been ruled in this Court that under the guise of a fee there must not be an attempt to raise revenue for the general funds of the State. In our opinion, a renewal fee of Rs. 50 does not entail services which can be reasonably said to measure against the charge. It may be pointed out that, though this averment was made in the petition, 123 No. attempt was made by the answering respondents to traverse it. In our judgment the renewal fee of Rs. 50 ceases to be a fee, and is, in its nature, a tax to raise revenue. Such an impost cannot be justified ' as a fee, and we accordingly, hold that this charge is improper. It would, however, be open to the Government to frame a rule in which the renewal fee to be charged is reasonable in the circumstances. The next objection is to sub r.(g) and sub r.(k) of Rs. 15. Sub rule (g) requires a Custom House Agent to pay over to Government all sums received for payment and to account to his client for monies in his hands. Sub rule (k) requires him to maintain accounts in such form and manner as may be directed from time to time by the Castoms collector, and submit them for inspection to the Customs collector or an officer authorised by him. No exception can be taken to sub r.(g) which only states what must be regarded as an inevitable obligation on the part of the Agent. Sub rule (k) is said to be excessive control on the part of the Customs authorities of the way in which the agent may keep his own account. :The licensing of an agent creates an assurance,, in the minds of the prospective clients, and the Rule is designed to ensure that the monies which the agents handle are properly accounted for. In our opinion, these Rules are salutary, and further the control over the agents, who stand in a fiduciary capacity both in regard to their own clients and the Government. Rule, 17, which enjoins upon a firm which acts as a licensee to report to the Customs collector as early as possible and, in any event, within a period of three days of a change in the constitution of the firm, is next challenged. It is said that the period of three days is too short ; but it" must be remembered that 'a large number of transactions may go through without the licensing authority being aware that the constitution of a firm has changed. The Rule is designed to bring promptly to the notice 124 of the Customs collector the change in the constitution of the firm, so that he may be in a position to decide for himself whether the licence in the changed circumstances should be allowed to operate or be suspended or revoked. In our judgment, this Rule, cannot be questioned. Mr. Porus Mehta who argued the case on behalf of the Clearing Agents, stated that the newly constituted firm is required to make a fresh application which is to be dealt with in accordance with the provisions of rr. 6 to 13. According to him, every change in the, constitution of the firm requires the firm to go through the entire process of scrutiny and examination, which he ' terms unnecessary. The rule is designed to ensure that the new members of firm answer the requirements which have been laid down is Rules 6 to 13, and these requirements may be necessary, if new,entrants come in. It is to be noticed that pending the disposal of the application, the Customs collector is authorised by the rule in his discretion to allow the existing firm to carry on the business of Custom ' House Agents. This softens the rigorous of the rule, because the work of the agents in proper cases would not be hampered, and the application would stand over for disposal to a later date. Rule 19 which also enjoins the maintenance and inspection of accounts by a firm was criticised in the same manner as was r. 15, and for the reasons which we have given, we hold it to be conducive to the proper control of the financial activities of a firm as licensee. Rule 22 deals with the cancellation of the licence for failure of the agent to comply with Any conditions of the bond executed by him, under "the Rules, for failure to comply with any of the, provisions of the Rules and for misconduct on. his part which, in the opinion of the Customs colloctor renders him unfit, to transact business in the 125 Customs House. It is contended that,the rules are so exhaustive and numerous thatno agent would ever be able to keep out of theoperation of that Rule, and that he would be ' perpetually exposed to the penalty of suspension or revocation of his licence. Rules are made for compliance and not for breach, and even though strict, they are all designed to ensure efficient and proper working on the part of the agents. A rule insisting upon such compliance with the other rules on pain of penalty _cannot be said to be outside the rulemaking power of the Customs authorities. Every order of suspension or revocation is subject to appeal, and there is thus room for interference if the Customs collector acts arbitrarily or perversely. In our: opinion, with the existence of an appeal, the rigour of the rule, if any, is taken away except in those flagrant cases, where suspension or revocation of the licence would be merited. Lastly, it is contended that the Rules control a licensed agent in a manner which makes him an unpaid servant ' of the Customs authorities. This is one way of looking at the matter. The right way to look at it is that a profession is being regulated, and the profession is one in which an agent deals with the property of another and by the law is deemed to be owner of the property. A person in such a high fiduciary position must, of necessity, be subjected to strict control, and the licensing authority in holding him forth to the prospective principals as a reliable and trustworthy person must see that persons acting on the faith of the assurance of the licence are in no way damning. The Rules, therefore, subserve a very salutary and necessary principle, and, in our judgment, are designed to advance public interest and cannot be questioned, unless a person wishes to act, dishonestly and wants to avoid control. It is wellknown that many underhand practices are common at Customs Houses, and 'the Customs authorities 126 have to be vigilant in preventing them. They must, therefore, see that they do not license the wrong type of person is and in the interests of the Revenue and more so, in the inte rests of persons who employ licensed agents, these Rules have, been framed. Looking at the Rules generally, we are of opinion that though they, are strict, they axe Absolutely necessary, and their strictness would be felt only by persons, who, are not otherwise honest. The main argument in the case is upon r.12 read with From It, which is the bond which every applicant has to executive in favour of the President of India, and its enforcement against the applicant under certain 'circumstances. Under r. 12, it is provided that before a licence is granted under the Rules, the Customs collector shall require the applicant to enter into a bond in Form 'C ' for the 7 due observance of these Rules. and the conditions of his licence and also to furnish a security of Rs. 3,000 in cash or securities and a solvent surety for a sum of Rs. 2,000. The surety is required to execute ' a separate bond in, Form 'D '. A proviso added to the 'Rule says that the security may be: increased or, decreased by the Customs collector at any time, should he, consider it necessary to do so, having regard to the volume and type of the business which the applicant will transact as Custom House Agent. It may be mentioned here, that the four classes of agents which had grown in the past have now been fused into one, and an agent under the Rules may not confine his activities to those of any one or more of the four classes previously existing. Objection, however, is taken to the basic figure of security and particularly, the cash security of Rs 3000, which are innovations under the present Rules. Reference is made to the provisions of Form 'C ', in which it is provided as follows: 127 "It is also agreed and declared that the President of India may apply the above sum of Rs. . in making good wholly or in part, any short collection of duty or other charges in respect of any transactions made by the said. on behalf of importers in the event of such sums remaining unpaid,, even after issue of demands under section 39 of the . " The petitioners contend. that the increased security, particularly, in cash, puts an unreasonable restriction upon the right to carry on the profession or avocation. They point to the fact that in the, past a security of Rs. 2,000 had been considered adequate, and from 1937 onwards, that security alone was demanded. They also contend that as Dalals they are only required, to present the shipping bills and the assessment or appraisement of the customs duty is the function of the Customs Officer. If any mistakes are made, due to an error on the part of the Customs authority, or even due to a wrong declaration of the real value of the goods by the importer, the collection of duty should be made from the owner of the goods and not from them. They also contend that this is the meaning and intent of section 39, which, in terms, makes the owner of the goods liable to make up for the short collections and puts no responsibility on the agents. They further. contend that the last clause of the bond, quoted earlier, makes the agent liable for payment of the balance of the duty before any attempt is made to recover it from the owner or importer. The last point need not detain us long, because it is raised on the existence of the ' word " 'even" in the clause "even after issue of demands under section 39 of the ". The word "even" does not mean that the agent 's security can be touched before the notice is given. It rather indicates that the security would be utilised to make up the deficit only when a notice 128 is given and if even after notice there is no compliance. This would indicate that before the ,security is so utilised, a notice must go to the agent or his principal, and the bond makes the notice a sine qua non of an action to recoup the deficit duty from the security amount. The larger question whether the agent can be made responsible for the short collection of duty under s.39 may be deferred for the moment. Previous to the promulgation of the Rules, there were, as already stated, four classes of Agents, and their duties, by custom and usage, were also different. It is now contemplated to make a single class of agents and also to restrict the number of such agents. It is quite clear, therefore, that the amount of business which would be done by the agents who are licensed, would grow significantly. Also, each agent would be entitled to do all kinds of businesses which were handled separately. This justifies the demand for increased security, and it should be noticed that there is room for the reduction of the duty in individual cases, if the amount of business which the agent would carry on, would be small. Similarly, there is provision for demanding increased security from a person who does or is expected to do a much larger amount of business as an agent. There is thus no room for a proper adjustment of the amount of security to be obtained from each individual licensed agent, commensurate with the volume and type of business which he will transact. We do not, therefore, consider that r. 12 is defective on this ground. Before we deal with section 39, it is necessary to review certain other sections of the . Under the , it is not obligatory upon a principal to appoint a licensed agent. An importer or exporter, as the case may be, can also appoint any person with the approval of the Customs collector as 129 his agent, who need not be a licensed agent. (R.3). The Rules are me ant to control action of agents, particularly the licensed agents. Under the Act, the position of an agent, whether licensed or not, is indicated in section 4, which reads "When any person is expressly or impliedly authorized by the owner of any goods to be his agent in respect of such goods for all or any of the purposes of this Act. and such authorization is approved by the Customs collector, such person shall, for such purposes be deemed to be the owner of such goods." , One of the duties of the ' owner of the goods is to make a declaration of the real value of the goods in a bill of entry or shipping bill. Under section 29, on the importation into, or exportation from, any customs port of any goods, whether liable to duty or not, the owner of such goods must, in his bill of entry or shipping bill as the case may be, state the real value, quantity and description of such goods to the best of his knowledge and belief, and must subscribe a declaration of the truth of such statement at the foot of such bill. Under the same section, the Customs collector may require the production of invoices, broker 's note, policy of insurance or other document to satisfy himself about the real value, quantity or description of such goods. The Customs Collector is also authorized to inspect the goods for the same purpose. Under sections 29A and 29B, there may be an assessment of duty prior to the examination of the goods and a provisional assessment of duty and its payment even prior to, the production of the documents above mentioned or the inspection of the goods. Section 30 of the Act defines "real value" and that is the value on which the assessment of the goods takes place. That section is not dependent upon the 'declaration of the owner, but defines "real value" in terms of a formula which, on its application determines of the real value, apart from any declaration. 130 Section 31 provides for the examination of ad valorem goods, and if the real value such goods is correctly stated in the bill of entry or shipping bill, the goods are assesssed in accordance therewith. Section 32 provides for the procedure, if it appears that such goods are properly chargeable. with a higher rate or amount of duty than that to which they were subject according to the value stated in the bill of entry or shipping bill. The Officer may then detain the goods and collect the proper duty. Sections 33, 34A and 35 deal with abatement allowed or disallowed under certain circumstances. Sections 36, 37 and 38 deal with the alteration of import and export duties or tariff valuations. When the proper duty has been paid according to the checks and inspections, if any, the goods are allowed to be cleared. Section 39, as the marginal note, shows correctly, deals with payment of duties not levied, short levied or erroneously refunded. , The first subsection, provides as follows : "(1) When customs duties or charges have, not been levied or have been short levied through inadvertence, error, or collusion or misconstruction on the part.of the Officers of Customs, or through misstatement as to real value, quantity. or description on the part of the owner or when any such duty or charge, after having been levied, or has been, owing to any such cause, erroneously refunded, the person chargeable with the duty or charge which has not been levied or which has been so short levied or to whom such refund has erroneously been made, shall pay the duty or charge or the deficiency or repay the amount paid to him in excess., on a notice of demand being issued to him within three months from the relevant date as defined in sub section (2); 131 and the Customs collector may refuse to pass any goods belonging to such person until the said duties or charges or the said deficiency or excess be paid or repaid," ' The second sub section need not be quoted, because ,it does not bear upon the controversy. The contention of the Petitioners is that although in the first paragraph of section 39(1) the word "owner" may comprehend an agent who is deemed to be an_owner, if authorised under the Act, the, section does not use the word "owner" in the latter part, and speaks of "the person chargeable with the duty", meaning thereby a change over to the real owner of the goods in contradistinction to the agent. They urge that this is even more apparent from the words of the fourth paragraph of the first sub,section which authorises the Customs collector to refuse to pass any goods belonging to ",such person" which must mean the goods belonging to the real owner, who is properly chargeable with the duty. It is contended, therefore, that as the agent is not within the reach of s.39, the demand of duty from him cannot be made, and that the provisions of the bond by which the agent and his security are made liable, are beyond the provisions of section 39 and thus invalid. One, thing is clear that the Customs authorities may have no dealing with the real owner of the goods where the agent has been authorised to deal with them for the purposes of the or any of its provisions. Section, 4 clearly lays down a fiction, that if the agent is authorised by the real owner in respect of any of the matters in the Act, the Customs authorities would deal ' with the agent as if he were the owner. The effect of the fiction is, therefore, to make an agent answerable to the Customs authorities within the four corners of his authorisation. The fiction operates only within those limits. An agent may be authorised 132 to declare the real value and to pay the customs duty or other charges. If an agent is authorised in this manner, under the fiction created by section 4 he would be regarded as the owner and would be dealt with as such, by the Customs authorities. It bar, already been pointed out that the real value, quantity and description of the goods have to be declared in the bill of entry or the shipping bill. A form was shown to us at the bearing in which the declaration has to be made either by the real owner or the agent. The form emphasis also that all responsibility for the declaration and for the payment of the proper duty and charges may be taken by an agent. Once an agent has made a declaration and has also been authorised to pay the duty etc. , it is to him that the Customs authorities would look for payment or additional payment, and it is to him that refunds would be, made. The Customs authorities would not deal with the real owner, and that is the scheme of the Act. When section 39 says that where customs duties or charges have not been levied or have been short levied through inadvertence, error collusion or misconstruction on the part of the officers of Customs, or through misstatement as to real value, quantity or description on the part of the owner, it refers not only to the real owner,, but also to an agent, if the latter can be deemed to be the owner. , This is indeed, conceded by the petitioners. The question then arises, what does the section mean when it speaks of " 'the person chargeable with the duty or charge which has not been levied or Which has been so short levied, or to whom such refund has erroneously been made"? Obviously enough, the person to be charged, in so far as the Customs authorities are concerned, is not the, real owner but the agent, a fictional owner of the goods. If a 'fictional owner, can be read into the first part 133 of the section there is no reason why the words "the person chargeable with duty" cannot also be applied to him. In the circumstances in which the agent makes a declaration with authorisation from the real owner, the agent is the person chargeable with the duty. Otherwise, for the duty chargeable in the first instance the agent would be the person charge able with the duty and 'for any short payment he would cease to be such a person and the Customs authorities would have to deal with the real owner, who made no declaration or payment. The words "the person chargeable with the duty. ", therefore, have advisedly been used not to exclude the agent but to describe in a neutral way the person from whom such a demand can be made. They are wide enough in their ambit to take in, not only the real owner but also a "deemed owner" under the Act. So far, there is no difficulty, and the objection of the learned counsel for the petitioners that a simpler method would have been to use the word " 'owner" in this part of the section ,is without substance, because the legislature may express its meaning and intention in different ways. The critical argument, however, is, on the. fourth paragraph of section 39(1). There, it is provided that if the excess charge is not paid, "the Customs collector may refuse to Pass any goods belonging to 'such person ' until the said duties or charges or the said deficiency or excess be paid or repaid". It is contended that an agent deals with numerous owners at the same time, and if this paragraph is applied literally, then the Customs collector would be entitled to refuse to pass the goods belonging to other Owners, handled by the same agent. This argument, in our opinion, does not represent the true state of the law. An agent, when he works for different owners with authorisation, undoubtedly becomes a fictional owner of the goods belonging to them; but he does not become. a single, owner in respect of the good belonging to 134 different clients. He becomes an owner quoad each client and his ownership of the goods is diversified and is not one. The agent, therefore, stands in the shoes of several persons at the same time, and is himself a multitude of owners. It is only when short payment has been made in his capacity as one fictional owner, that he can be asked to pay that which he ought to have paid in the first instance. He is exposed to the penalty of having his goods detained in the, same capacity as owner quoad his defaulting client, and the goods within his control for the same client will be detained until the duty has been paid. It is only the goods of the defaulting owner in respect of which he is also the deemed owner, that would suffer the penalty of detention but not the goods of a different owner, even though the agent may be authorised to deal on his behalf. It is in this way that the section must be read ' without contradiction in its several parts, because to read it as suggested by the petitioners, creates a contradiction between the first paragraph and the other paragraphs that follow. An authorised agent is an owner for all purposes of the Act (including payment of duty). If one were to say that in the other paragraphs of section 39(1) he is not included, then the fiction which is created by section 4 would cease to be worked out to its logical limits. Once it is held that the words ", 'the person chargeable with the duty. . . are apt to describe not only the real owner but also his authorised agent (and there is no reason why these words should be restricted), the fourth paragraph falls in line with the others, and the ownership of the agent is, therefore, limited to one client at a ' time, and the goods of that client of which the agent is also the deemed owner, are exposed to the. penalty of detention. It must be remembered that the Act makes the 'goods ' liable to duty and the payment of duty by owners clears the goods. The law goes further, and says that other goods of the owner are also liable for an deficit, if the 135 liable to duty are 'cleared. ' before the full duty has been paid. The condition in the bond is limited by the operation of s.39 to the transactions of one constituent at a time, and the for feature of security is also limited to the constituent in default. The bond prescribes for recouping of the deficiency in the customs duty or charges from the security, even after notice is given. This notice must be given within three months from the relevant date as demand in the section. The limit of three months also applies to the agent as the deemed owner in the same way as it does to the real owner. If no notice. is given, then the bond, on its own terms, cannot be enforced. In our opinion, the contentions of the petitioners are not, sustainable. In the result, the petitions must fail except to the extent that we declare r. 10(c) to be an unreasonable restraint upon the right of the petitioners to carry on their avocation and r.11 when it prescribes a renewal fee of Rs. 50, invalid inasmuch as it has provided not for a fee but for a tax. Subject to this, the petitions are dismissed. The petitioners will pay the costs of the other side (one set only), as they have lost substantially. SUBBA RAO, J. I have, had the advantage of ', perusing the judgment prepared by my learned brother, Hidayatullah, J. I agree with him except in regard to r. 6(c) of ' the Custom House Agents Licensing Rules, 1960 (hereinafter called the Rules). Rules 6(c) says : "An applicant for a licence shall furnish an income tax clearance certificate. " The Rules were made to regulate the conduct of the clearing agents so that they may discharge their duties to the satisfaction of not only the Customs Authorities but also the public. In my view, the production of income tax clearance certificate is extraneous to the issue, of a licence to a customs house agent. How ' does the 'production of such a certificate improve the credentials of an applicant 136 for selection as a customs house agent, An applicant may be financially sound and also otherwise duly qualified; he may have discharged all his debts, and paid all his taxes except a small portion of his income tax: he may not have paid the income tax for good reasons. Yet, if he goes. not produce the income tax clearance certificate, he is disqualified. What is. the reasonable nexus between the production of such a certificate and a person 's right to do business as a clearing agent ? There is none, except a remote and fanciful presumption that a man who pays the income tax. may also pay the dues payable to the Customs Authorities. In K. Raman & Co., Tellicherry vs State of Madras (1), in the context of issue of a licence under the Yarn Dealers Control Order, as Judge of the Madras High Court,, I have held, "the fact that a person is in arrears of income tax is not germane to the issue of a licence under the Yarn Dealers Control Order. It is a, circumstance extraneous to the petitioner 's right to carry on his business. The Income tax Act provides an adequate machinery for realising the arrears due from an assessee. I am of the view that the restriction imposed is unreasonable and is not in the interests of the general public. " I still adhere to that view. Every taxing Act has a machinery for collecting the tax imposed by it, but the said rule, in effect and substance, provides for an additional machinery for collection of income tax. I would, therefore, hold that the nonproductive of an income tax clearance certificate is not germane to the issue of a licence under the said Rules. I would therefore strike out r.6(c) of the Rules on the ground that it constitutes an unreasonable restriction on the right of an applicant to do business as customs, house agent, (1) A.I.R. 1953 mad. 137 BY COURT: In accordance 'with the opinion, of the majority, the petitions must fail except to the extent that we declare r.10 (c) to be: an unreasonable restraint upon the right of the, petitioners to carry on their avocation, and r.11, when it prescribes a renewal fee of Rs. 50, invalid inasmuch as it has provided not for a fee but for a tax. Subject to this, the petitions are dismissed. The petitioners will pay the costs of the other side (one set only), as they have lost substantially.

The petitioners were working as Dalals at New Customs 109 House, Bombay, under licences issued under section 202 of the Sea Customs Act, 1 878. In 1955 by an amending Act, section 202 was substituted by another section and, by sub s.(1) of section 202 it was enacted : "no person shall act as an agent for the transaction of any business relating to the entrance or clearance of vessel or the import or export of goods or baggage in any custom house unless such person hold '$ a licence granted in this behalf in accordance with the rules made under sub section (2) ". By sub section (2) the Chief Customs authority was empowered to make rules for the purpose of carrying out the provisions of the section. Section 4 provided that "when any person was . authorised by the owner of the goods to be his agent in respect of such goods for all or any of the purpose, of thisAct. such person shall for such purposes be deemed to be the owner of such goods". The petitioners who, after the enactment of the news.202, had to apply for licences to be granted in accordance with 'the rules framed under sub s(2), challenged the validity of certain of the rules on the ground that they contravened articles 14 and 19 of the Constitution of India and also that they were in excess of the rule making power conferred by s.202 (2). In particular, they questioned power validity or r. 12 under which inter alia the agent was required to enter into a bond in Form C by which he was made liable for short collection of customs duty under section 39 and also to furnish security which might be increased or decreased by the Customs collector. Held : (1) that the rules in question though they were headed as framed under section 202 of the , cannot be impugned on the ground that some of them go beyond the special purposes of that section and seek to further some of the general purposes of other parts of the Act, since the Chief Customs authority is also empowered under section 9 of the Act to make. rules consistent with the Act "generally to carry out the provisions of the Act." (2) that rr. 4 and 8 under which the Customs collector could limit the number of licences to be granted at the Customs House and applications could only be made if the Customscollector published a notice inviting applications, do not contravene article 19 of the Constitution, as they are only designed to advance public interest. (3) that rr. 6(a) and 6(b) which require the applicant, to furnish to the Custom 's collector satisfactory evidence as to his respectability, reliability and financial status and that he would be in a position to muster sufficient clientel, 110 and business in the event of his being granted the licencee, are reasonable restrictions within the meaning of article 19(6) and are valid. (4) that cl. (p) of r. 9(2) whicn requires the licensee to have a working knowledge of the procedure in the matter of refund of claims, appeals and revision petitions under the , is valid, since it is necessary where an, agent handles goods of the principal. (5) that r. 10 (1)(c) which gives the Customs collector a wide discretion to reject an application for the grant of a licence, if he considers the applicant to be not suitable, is an unreasonable restriction upon the right of the successful candidate to carry on his avocation, and is invalid. If a candidate is found fit under the other rules and has successfully passed the examination, he should only be rejected under a rule which requires the Customs collector to state his reasons for the rejection, and the rules must provide for an appeal against the order. (6) that r. 11, in so far as it prescribes a renewal fee of Rs. 50,is invalid inasmuch as it has thereby provided not for a fee but for a tax to raise revenue. It would be open to the Government to frame a rule in which the renewal fee to be charged is reasonable in the circumstances. (7) that rr. 15(g), 15(k), 17 and 19, are designed to have a control over agents, including firms which act as agents, who stand in a fiduciary capacity both in regard to their own clients and the Government, and are valid. (8) that r, 22 which enables the Customs collector to cance a licence for non compliance by the agent with the other rules or for misconduct on the part of the agent, which in the opinion of the Customs collector, renders him unfit to transact business in the Custom House, is within the rule. making power of the Customs authorities and is valid. (9) that the words "the person chargeable with the duty or charge" in section 39(1) of the. Act are wide enough. in their ambit to take in, not only the, real owner but also a "deemed owner" within the meaning of s.4 of the Act. (10) that on its true construction of s.39(1) it is only the goods of the defaulting owner in respect of Which, the agent is also the deemed owner that would suffer the penalty of detention, but not the goods of a different owner, 111 even though the agent may be authorised to deal on his behalf. (11) that r. 12 read with Form C, which makes an agent liable for short collection of customs duties under section 39, is valid and the rule is not invalid on the ground that it enables the Customs authorities to make a proper adjustment of the security to be obtained from each individual agent commensurate with the volume and type of business which he might transact. Held, further (Subba Rao, J. dissenting,) that r. 6(c), which requires the applicant to produce an income tax clearance certificate, is connected with the enquiry into his respectability and financial status to find out if fie can be trusted with other persons ' money and goods, and is valid. K. Raman and Co. vs State of Madras, A. I. R. 1953 Mad. 84, distinguished. Per Subba Rao, J. Non production of an income tax clearance certificate is not germane to the issue of a licence under the Custom House Agents Licensing Rules, 1960, and the principle in K. Raman and Co. vs State of Madras, A. I.R. , is applicable. Accordingly, r. 6(c) constitutes an unreasonable restriction on the right of an applicant to do business as Custom house agent, and is invalid.

Criminal Appeal No. 118 of 1961. Appeal by special leave from the judgment and order dated May 10, 1961, of the Punjab High Court (Circuit Bench) at Delhi in Criminal Misc. No. 256 D of 1961. , C. K. Daphtary, Solicitor General of India, Bepin Behari Lal, T. M. Sen and R. H. Dhebar, for the appellant. N. C. Chatterjee, Mehar Singh Chaddah A. K. Nag and I. section Sawhney, for the respondent. 623 1961. September 14. The Judgment of, the Court was delivered. by WANCHOO, J. The respondent Jagjit Singh along with two other 's ' was prosecuted for conspiracy and also under sections 3 and 5 of the Indian Official Secrets Act, No. XIX of 1923, (hereinafter called the Act). The respondent is, a former captain of the Indian Army and was at the time of. his arrest in December, 1960, employed in the delegation in India of a French company. The other two persons were employed in the Ministry of Defence and the Army Headquarters, New Delhi. The case against the three persons was that they in conspiracy had passed on official secrets to a foreign agency. The respondent applied for bail to the Sessions Judge; but his application was rejected by the Additional Sessions Judge, Delhi. Thereupon the respondent applied under section 498 of the Code of Criminal Procedure to the High Court, and the main contention urged before the High Court was that on the facts disclosed the case against the respondent could only be under s 5 of the. Act, which is bailable and Dot under section 3 which is not bailable. The High Court was of the view that it was hardly possible at that stage to go into the question whether section 3 or section 5. applied ; but that there was substance in the suggestion on behalf of the respondent that the matter was arguable. Consequently the High Court took the view that as the other two persons prosecuted along with the respondent had been released on bail, the respondent should also be so released, particularly as it appeared that the trial was likely to take a considerable time and the respondent was not likely to abscond. The High Court, therefore, allowed bail to the respondent. Thereupon the State made an application for special leave which was granted. The bail granted to the respondent was cancelled by an interim order by. this Court, and the matter has now come up before us for final disposal. There is in our opinion a basic error in the order of the High: Court. Whenever. an application for bail is made to a court, the first question that 624 it has to decide is whether the, offence, for which the accused is being prosecuted is bailable or otherwise. If the offence, is bailable, hail will be granted, under section 496 of the Code of Criminal Procedure without more ado ; but if the offence is not bailable, further considerations will arise and the court will decide the question of grant of bail in the light of those further considerations. The error in the order of the High Court is; that it did not consider whether the offence for which the respondent was being prosecuted was a bailable one or otherwise. Even if the High Court thought that it would not be proper at,, that stage, where. commitment proceedings were: to take place, to express an opinion on the question whether the offence in this case fell under section 5 which is bailable or under: section 3 which is not bailable, it should have proceeded to deal with the application on the assumption that the offence was under section 3 and therefore not bailable. The High Court, however, did not deal with the application, for bail on this footing, for in the order it is said that the question whether the offence fell under section 3 or section 5 was arguable. It follows from this observation that the High Court thought it possible that the offence might fall under section 5. This, in our opinion, was the basic error into which the High Court fell in dealing with the application for bail before it, and it should have considered the matter even if it did not consider it proper at that stage to decide the question whether the offence was under s.3 or s.5, on the assumption that the case fell under section 3 of the Act. It should then have taken into account the various considerations, such as, nature and seriousness, of the offence, the character of the evidence, circumstances which axe peculiar to the accused, a reasonable possibility of the, presence of the accused not being secured at the trial, reason , able apprehension of witnesses being tampered with, the larger interests of the public or, the State, similar other considerations, which arise when, court is asked for bail in a non bailable offence. It is true that under section 498 of the Code, of Crime 625 Procedure, the powers of the High Court in the matter of granting bail are very wide; even so where the offence is non bailable, various considerations such as those indicated above have to be taken into account before bail is granted in a non bailable offence. This the High Court does not seem to have done, for it proceeded as if the offence for which the respondent was being prosecuted might be a bailable one. The only reasons which the High Court gave for granting bail in this case were ' that the other two persons had been granted bail, that there was no likelihood of the respondent absconding, he being well connected, and that the trial was likely to take considerable time. These are however not the only considerations which should have weighed with the High Court if it had considered the matter as relating to a non bailable offence under section 3 of the Act. The first question therefore that we have to decide in considering whether the High Court 's order should be set aside is whether this is a case which falls prima facie under section 3 of the Act. It is, however, unnecessary now in view of what has transpired since the High Court 's order to decide that question. It appears that the respondent has been committed to the Court of Session along with the other two persons under section 120 B of the Indian Penal Code and under sections 3 and 5 of the Act read with section 120 B. Prima facie therefore, a case has been found against the, respondent under section 3, which is a non bailable offence. It is in this background that we have now to consider whether the order of the High Court should be set aside. Among other considerations, which a court has to take into account in deciding whether bail should be granted in a non bailable offence, is the nature of the offence; and if the offence is of a kind in which bail should not be granted considering its seriousness, the court should refuse bail even though it has very wide powers under section 498 of the Code 626 of Criminal Procedure. Now a. 3 of the Act erects an offence which is prejudicial to the safety or interests of the State and relates to obtaining, collecting, recording or publishing or communicating to any other person any secret official code or paw word or any sketch, plan, model, article or note or other document or information which is calculated to be or might be or is intended to be, directly or indirectly, useful to an enemy. Obviously, the offence is of a very serious kind affecting the safety or the interests of the State. Further where the offence is committed in relation to any work of defence, arsenal, naval, military or air force establishment, or station, mine, minefield, factory, dockyard, camp, ship or aircraft or otherwise in relation to the naval, military or air force affairs of Government or in relation to any secret official code, it is punishable with fourteen years ' imprisonment. The case against the respondent is in relation to the military affairs of the Government, and prima facie therefore, the respondent if convicted would be liable upto fourteen years ' imprisonment. In these circumstances considering the nature of the offence, it seems to us that this is not a case where discretion, which undoubtedly vests in the court, under section 498 of the Code of Criminal Procedure, should have been exercised in favour of the respondent. We advisedly say no more as the case has still to be tried. It is true that two of the persons who were prosecuted along with the respondent were released on bail prior to the commitment order; but the case of the respondent is obviously distinguishable from their case inasmuch as the prosecution case is that it is the respondent who is in touch with the foreign agency and not the other two persons prosecuted along with him. The fact that the respondent may not abscond is not by itself sufficient to induce the court to grant him bail in a case of this nature. Further, as the respondent has been committed for trial to the Court of Session, 627 it is not likely now that the trial will take a long time. In the circumstances we are of opinion that the order of the High Court granting bail to the respondent is erroneous and should be set aside. We therefore allow the appeal and set aside the order of the High Court granting bail to the respondent. As he has already been arrested under the interim order passed by this Court, no further order in this connection is necessary. We, however, direct that the Sessions Judge will take steps to see that as far as possible the trial of the respondent starts within two months of the date of this order. Appeal allowed.

The respondent who was a former Captain of the Indian Army and was employed in the delegation in India of a French Company was prosecuted along with two others for conspiracy and passing on Official Secrets to a foreign agency under ss.3 and 5 of the Official Secrets Act. His application for bail was rejected by the Sessions judge but the High Court allowed bail on the ground inter alia that his case might fall only under s.5 which was bailable and not section 3 which was not bailable. It did not express any opinion whether the case fell under section 5 or section 3 in view of the commitment proceedings which were going on at the time. On appeal by the State. Held, that the High Court should have proceeded to deal with the application for bail on the assumption that the offence was under section 3 and therefore not bailable. It should have then taken into account the various considerations such as, nature and seriousness of the offence, the character of the evidence circumstances peculiar to the accused, possibility of his absconding, tampering with witnesses larger interests of the public. and the State and similar other considerations Which arise When bail is asked for in a non bailable offence. The fact that the applicant for bail might not abscond was not by itself a sufficient ground for granting bail.

minal Appeal No. 248 of 1960. Appeal by special leave from the judgment and order dated October 31, 1960, of the Rajasthan High Court in D. B. Criminal Appeal No. 290 of 1960 and D. B, Criminal Murder Reference No 7 of 1960. 591 R. L. Anand, C. L. Sareen and B. L. Kohli, for the appellants. S.K. Kapur and T. M. Sen, for the respondent 1961. September. The Judgment of the Court was delivered by WANCHOO, J. This is an appeal by special leave from the judgment of the Rajasthan High Court. It arises out of an incident in which Bhimsen was murdered on May 8, 1959 at Mandi Pili Bangan shortly before 3 P.m. The prosecution story briefly was, that there was bad blood between Ramratan appellant and the members of the family of Bhimsen on account of panchayat elections in which they had supported rival candidates. Another cause for. enmity was that some time before the occurrences Ramratan appellant was prosecuted under section 307 of the Indian Penal Code and Bhimsen was cited as a prosecution witness in that case and Ramratan did not like that. Bhimsen and his father brought some gram for sale on the night between May 7/8, 1959, to Pili Bangan. Bhimsen returned to the village to bring more grain and came back at about10/11 A.M. on the 8th on his tractor trolly along with his brother Ram Partap. The gram was to be sold 'through Roopram and was stacked in front of his shop in the mandi. Ram Partap was apparently not interested in the sale; and had wandered away leaving his father Jawanaram and his brother Bhimsen at the shop. Shortly before 3 p.m. while the gram was being weighed by Lekhram weighman, the three appellants and two others (namely, Moman and Ramsingh) came up there armed with ,guns. Ramratan shouted that the enemy should not be allowed to escape as Bhimsen was trying to enter the shop of Roopram to save himself on seeing these persons. Before, however, Bhimsen could enter the shop of Roopram, Ramratan came in between and fired at him from a distance 592 about 5 feet. Bhimsen got injured and fell down and died soon after. Jawanaram raised his hands and asked the assailants not to kill Bhimsen but Hansraj appellant fired at him causing a wound on his left hand,. which resulted in a compound fracture. Maniram also fired at. Jawanaram but he dropped on the ground and pellets hit Lekhram weighman who was standing behind Jawanaram. Thereafter all the assailants ran away. Roopram had shut up his shop when the incident took place and he only came out When everything was over. Jawanaram asked him to send telegram to police station Suratgarh and told him the names of the five assailants. Thereafter jawanaram started for the police outpost in Pili Bangan to make a report; but Ramsingh constable met him on the way at a short distance from the shop of Roopram. Thereupon Jawanaram made a report (exhibit P 1) to Ramsingh then and there. While this report was being recorded, Ram Partap also turned up. After the report had been recorded, Jawanaram was sent to the hospital where his injuries were examined at 3 30 P.m. Ramsingh constable went to the spot after recording the report and found the dead body of Bhimsen lying in front of Roopram 's shop It appears that head constable gone outside and returned at 5 P.M. and started investigation thereafter. The Sub inspector arrived on the scene at about 6 p.m. and took over the investigation and. completed it. Thereafter the three appellants and two others who have been acquitted by the Sessions Judge were prosecuted for this murder. The case of the appellants was that they had not committed this offence and that they had been implicated on account of enmity They examined no evidence in defence. The main prosecution evidence consisted of the statements of Jawanaram, his son Ram Partap, Roopram and Lekhram as to what happened at the spot. Jawanaram related the whole story as given above, Ram Partap said that he had come near 593 the spot on seeing the assailants going that way and hid himself at some distance and saw the incident from there. Roopram 's statement was that he shut up his shop as soon as he heard some noise outside and did not see the assailants. When he came out, however, he was told by Jawanaram the names of the five assailants and saw Bhimsen lying dead. He had also heard three reports of gunshots from inside his shop. He saw Jawanaram and Lekhram were also there injured and Jawanaram went away shortly after for making the report. Sometime thereafter the police came to the spot and started investigation. Lekhram stated that he was there weighing the gram. Four or five persons armed with guns came there and shouted and fired two or three times with the result that Bhimsen, Jawanaram and he were injured and Bhimsen died immediately. But he was unable to say whether the five persons in the dock were the assailants. Because of certain answers that he gave in cross examination this witness was treated as hostile by the prosecution. The Sessions Judge relied on the statement of Jawanaram and convicted the three appellants. He however, gave the benefit of doubt to the other two assailants and acquitted them. He did not rely on the statement of Ram Partap as he was of the view that Ram Partap did not arrive in the Mandi till about 6 P.m. He also did not rely on the statement of Lekhram, which in any case was useless in so far as the connection of the appellants with the crime was concerned. As to Roopram he held that his statement that Jawanaram had told him the names of the assailants immediately after the incident was over when he came out of his shop could not be used as corroborate on of the statement of Jawanaram under section 157 of the Indian Evidence Act, as Jawanaram had not said in his statement in Court that he had told Roopram the names of the five assailants He was also doubtful whether the report (exhibit P 1) was 594 recorded at 3 P.m. and thought that it might have been recorded any time up to 6 P.m. But even so he placed full reliance on the evidence of Jawanaram only and convicted the three appellants, sentencing Ramratan to death and the other two to imprisonment for life. This was followed by an appeal to the High Court by the convicted persons. The Sessions Judge also made a reference for the confirmation of the sentence of death passed on Pamratan. The High Court dismissed the appeal. It also accepted the evidence of Jawanaram in the main. The High Court was further of opinion that Ram Partap was in Pili Bagan when the incident took place having come there with his brother Bhimsen at about10/11 A.M.; but the High Court did not think it fit to rely on his evidence as to the actual incident, for it thought that he had not been able to see it properly from where he said he was hiding. Further the High Court did not consider the evidence of Lekhram of much value as if, did not connect the appellants with the crime. But the High Court was of the opinion that Roopram 's statement that Jawanaram had told him immediately after the occurrence the names of the five assailants was admissible in evidence and could be used to corroborate the statement of Jawanaram. The High Court thought that this statement of Roopram was admissible under section 6 as well as under a. 157 of the Evidence Act. The High Court therefore upheld the conviction on the evidence of Jawanaram corroborated as it was by the evidence of Roopram. The High Court having refused to grant a certificate, the appellants applied to this Court for special leave which was granted; and that is how the matter has come up before us. Two main contentions have been urged before, us on behalf of the appellants. In the first place, it is urged that the High Court was not right in the view that the statement of Roopram was 595 admissible under section 6 and section 157 of the Indian Evidence Act and went to corroborate the statement of Jawanaram. Secondly, it is urged that once the statement of Roopram is ruled out as inadmissible there is only the statement of Jawanaram left to connect the appellants with the crime and in the circumstances of this case that solitary evidence should 'De held insufficient to bring home the guilt to the appellants. The first question therefore that arises in the appeal is whether the statement of Roopram to the effect that Jawanaram told him immediately after the incident, when he came out of his shop that the appellants and two others were responsible for the murder of Bhimsen and the injuries to Lekhram and himself, is admissible, either under section 6 or under section 157 of the Indian Evidence Act. We (lo riot think it necessary to consider whether this statement of Roopram is admissible under section 6 of the Evidence Act and shall confine ourselves to the question. whether it can be admitted under section 157 as corroboration of Jawanaram 's state ment. Learned counsclfor the appellants in this connection relies on Mt. Misri vs Emperor (1), and Nazar Singh vs The State (2) which support him and lay down that unless the witness to be corroborated says in his statement in court that be, had told certain things immediately after the incident to another person, that other person cannot give evidence and say that the witness bad told him certain things immediately after the incident. The argument is that the corroboration that is envisaged by section 157 is of the statement of the witness in court that he had told certain things to the person corroborating the witness 's statement, and if the witness did not say in court that he had told certain things to that person, that person cannot state that the witness had told him certain things immediately after the incident and (1) A.I.R. 1934 Sind 100, (2) A.I.R. 1931 Pepsu 66. 596 thus corroborate him. We are of opinion that this contention is incorrect. Section 157 is in these terms: ",In order to corroborate the testimony of a witness, any former statement made by such witness relating to the same fact, or at about the time when the fact took place, or before any authority legally competent to investigate the fact, may be proved. " It is clear that there are only two things which are essential for this section to apply. The first is that a witness should have Riven testimony with respect to some fact. The second is that he should have made a statement earlier with respect to the same fact at or about the time when the fact took place or before any authority legally competent to investigate the fact. If these two things are present, the former statement can be proved to corroborate the testimony of the witness in court. The former statement may be in writing or may be made orally to some person at or about the time when the fact took place, if it is made orally to some person at or about the time when the fact took place, that person would be competent to depose to the former statement and corroborate the testimony of the witness in court. There is nothing in section 157 which requires that before the corroborating witness deposes to the former statement the witness to be corroborated must also say in his testimony in court that he had made that former statement to the witness who is corroborating him. It is true that often it does happen that the witness to be corroborated says that he had made a former statement about the fact to some person and then that person steps into the witness box and says that the witness to be corroborated had made a statement to him about the fact at or about the time ",hen the fa ct took place. But in our opinion it is not necessary in view of the words of section 157 that in order to make corroborating evidence admissible, the witness to be corroborated must also say in his evidence that he had made such 597 and such statement to the witness who is to corroborate him, at or about the time when the fact took place. As we have said already what section 157 requires is that the witness to be corroborated must give evidence in court of some fact. If that is done, his testimony in court relating to that fact can be corroborated under section 157 by any former statement made by him relating to the same fact, and it is not necessary that the witness to be corroborated should also say in his statement in court that he made some statement at or about the time when the fact took place to such and such person. The words of section 157 are in our opinion clear and require only two things indicated by us above in order to make the former statement admissible as corroboration. We are therefore of opinion that the Sind and Pepsu cases were wrongly decided. Now let us see what happend in this case. Jawanaram was examined in court and stated about a certain fact (namely, that the assailants of Bhimsen, Lekhram and himself were five persons whom he named). The testimony of Jawanaram to be corroborated is his statement in court with respect to the fact that five persons attacked Bhimsen, Lekhram and himself. Section 157 makes his former statement with respect to the same fact admissible provided that the statement was made at or about the time when the fact took place or before any legal authority competent to investigate the fact. In this case we are concerned with the first of the two conditions necessary, namely, whether he had made that former statement relating to the same fact. at or about the time when the fact took place. The former statement which can be used as corroboration must be about the fact namely that Jawanaram had seen five persons attacking Bhimsen, Lekhram and himself and must have been made at or about the time when the fact took place i. e., when the attack was made. Now Roopram says that Jawanaram 598 had made the statement immediately after the incident was over that five persons including the three appellants had attacked Bhimsen, Lekhram and himself. This was therefore a former statement of Jawanaram at or about the time when the fact took place, namely, the attack by five persons on Bhim sen and others. This former statement can be proved by the person to whom it was made and can be used as corroboration of the evidence of Jawanaram. It was not necessary before the statement of Roopram as to what he heard from Jawanaram can be admissible for Jawanaram also to say in his testimony in court that he bad told Roopram immediately after the incident the names of the five assailants of Bhimsen and others. The former statement which can be used as corrobo ration is the, statement at or about the time the fact took place about which evidence has been given in court by the witness to be corroborated. Section 157 does not contemplate that before the; former statement can be proved in corroboration, the witness to be corroborated must also say in his testimony that he had made the, former statement. Of course if the witness to be corroborated also says in his testimony that he had made the former statement to someone that would add to the weight of the evidence of the person who gives evidence in corroboration, just as if the witness to be corroborated says in his evidence that he had made no former statement to anybody that may make the statement of any witness appearing as corroborating witness as to the former statement of little value. But in order to make the former statement admissible under section 157 it is not necessary that the witness to be corroborated must also, besides making the former statement at or about the time the fact took place, say in court in his testimony that he had made the former statement. We are therefore of opinion that even though Jawanaram did not say in his statement in court that he had told Roopram the names of the five assailants, Roopram 's 599 evidence that Jawanaram had made such a statement would be admissible under section 157 in corroboration of Jawanaram 's testimony as to the fact that five persons had attacked Bhimsen and others. As to the value to be attached to this corroboration in the present case, it is enough to say that Roopram is an independent witness and even though Jawanaram may not have said in evidence that he had told the names of the assailants to Roopram (perhaps by inadvertence as the High Court seems to think), we agree with the High Court in accepting the statement of Roopram that Jawanaram had immediately named the five persons who had attacked Bhimsen, Lekhram and himself. Thus the statement of Roopram corroborates the statement of Jawanaram in two ways : firstly, that there was an incident in front of his shop in which Bhimsen was murdered and Jawanaram and Lekhram were injured, arid secondly, proves the former statement of Jawanaram as to the persons who took part in the incident, thus corroborating his statement in court under s.157. This is not therefore a case where there is no corroboration of the testimony of Jawanaram, even if he were the solitary witness of the incident itself. As to the second point, namely, that we should not accept the solitary testimony of Jawanaram in the circumstances of this case, learned counsclrelies on Vemireddy Satyanarayan Reddy vs The State of Hyderabad (1). In that case there was the solitary testimony of one witness and it was urged that he was an accomplice. This Court hold that he was not an accomplice but remarked that "we would still want corroboration on material particulars in this particular case, as he is the only witness to the crime and as it would be unsafe to hang four people on his sole testimony unless we feclconvinced that he is speaking the truth. " The reason why this Court said so in that (1) ; 600 case was that though the witness was not an accomplice his position was considered somewhat analogous to that of an accomplice though not exactly the same. It was in those circumstances that this Court said that corroboration in material particulars would be required in the circumstances of that case. We are of opinion that those observations cannot be divorced from the context of that case. In the present case Jawanaram is neither an accomplice nor anything analogous to an accomplice; he is an ordinary witness who was undoubtedly present at the time the incident took place. '.rho case of such a solitary witness was considered by this Court in Vadivelu Thevar vs The State of Madras (1) and after referring to the earlier case it was held that as a general rule a court may act on the testimony of a single witness, though uncorroborated. It was further held that unless corroboration is insisted upon by statute, courts should not insist on corroboration except in cages where the nature of the testimony of the single witness itself requires as a rule of prudence, that corroboration should be insisted upon, and that the question whether corroboration of the testimony of a single witness was or was not necessary, must depend upon facts and circumstances of each case. These are the general principles which we have to apply in the case of the testimony of a single witness, like Jawanaram. But as we have held that in the present case there is corroboration of Jawanaram 's statement by his former statement deposed to by Roopram, it is not a case of altogether uncorroborated testimony of a single witness. In any case the evidence of Jawanaram has been considered by both the Sessions Judge and the High Court, and the Sessions Judge was prepared to convict the appellants on the sole testimony of Jawanaram while the High Court has also accepted that testimony, though it has added that it is corroborated by the statement of Roopram. In (1) ; 601 the circumstances when the evidence of Jawanaram has been accepted by both the courts, with or without corroboration, we see no reason to disagree with the conclusion of the two courts as to the value of Jawanaram 's evidence. The criticism made against the acceptance of the evidence of Jawanaram has been considered by the two courts and in spite of that criticism the two courts have come to the conclusion that the evidence of Jawanaram is reliable. We agree with the estimate of that evidence by the two courts and hold that Jawanaram 's evidence can be relied on in the circumstances of this case. Two main points are urged in this connection to shake the testimony of Jawanaram. It is said that Jawanaram has introduced Ram Partap in the first information report and that the Sessions Judge at any rate did not believe that Ram Partap was in Pill Bangan before 6 P.m. though the High Court held otherwise. Secondly, it is said that Jawanaram did not make the first report at about 3 P. M. and the Sessions Judge at any rate held that the report could have been made at any time upto 6 P.m. though the High Court held otherwise. We have been taken through the evidence in this connection and we agree with the High Court that even though Ram Partap might not have actually seen the incident he had definitely come to Pili Bangan at about II A.M. with his brother Bhimsen. There is the evidence of Ram Singh constable who says that Ram Partap came there when the report (exhibit P 1) was being written at about 3 P.m., which is supported by the fact that Ram Partap 's presence is mentioned in the report. The defence relied on a statement in the inquest report (Ex. P 4) in which it is mentioned at the end that Ram Partap son of Jawanaram also arrived during the course of the completion of the inquest report and was sent along with the corpse. This means that Ram Partap was not present when the inquest proceedings began and arrived there when they 602 were coming to an end. From this it cannot be inferred that Ram Partap was not in Pili Bangan at all before 6 P.m. There. is ample evidence, which the High Court has rightly believed, to show that Ram Partap had come to Pili Bangan at about 10 or 11 A. M. The other criticism with respect to the time when the report (exhibit P.1) was made is also in our opinion unjustified and the High Court was right in the view it took in that connection. There is no doubt that Jawanaram reached the hospital at 3 30 P.m. as deposed to by Dr. Sudershan Singh and that he was sent by the police. It is obvious therefore that Jawanaram had contacted the police before 3 30 P.m. It stands to reason that if he had contacted the police before 3 30 P.m. be must have made a report of the incident also and that is what exactly Ram Singh constable deposes. We agree with the High Court that in the circumstances there is no reason to disbelieve the statement of Ram Singh constable. The Sessions Judge was doubtful of the evidence of Ram Singh because he was of the view that documentary evidence from the police outpost at Pili Bangan had not been produced in support of Ram Singh 's statement. Ram Singh was asked about it and stated that though exhibit P 1 did not bear the despatch number as it was not sent to the outpost at all, he must have made entries in the diary of the outpost about his starting from there and his return and also about the occurrence, though he did not remember about it. After this statement of Ram Singh, the Sessions Judge was not right in disbelieving him because of the non production of the entries from the outpost. It would have been better if the prosecution had produced those entries ; but even if the prosecution rested upon the oral testimony of Ram Singh, the Sessions Judge could and should himself have sent for those entries, if he was inclined to disbelieve the oral testimony of Ram Singh constable who appears 603 to be a reliable witness. In the circumstances we are of opinion that the view of the High Court that the report was written at 3 P. m. as stated by Ram Singh constable is correct. The evidence of Jawanaram therefore cannot be rejected on these two grounds. Lastly it was urged that Jawanaram bad named five assailants and at least two have been acquitted, and that shows that Jawanaram is not wholly reliable. It is enough to point out that the Sessions Judge gave the benefit of doubt so far as two accused persons were concerned. He did not hold that Jawanaram 's evidence was false with respect to those two persons. Apparently those two persons did not take any active part in the incident and that may have led the Sessions Judge to give them the benefit of doubt; that is, however, no reason for disbelieving the testimony of Jawana ram. We are therefore of opinion that the two courts below were right in relying on Jawanaram. His evidence is corroborated undoubtedly by other witnesses to the extent that the incident did take place at the shop of Roopram; his statement that the three appellants and two others were the assailants is corroborated by his former statement made immediately after the incident was over and deposed to by Roopram. In the circumstances we are of opinion that the appellants have been rightly convicted. Two of the appellants (namely, Maniram and Hansraj) have been sentenced to imprisonment for life while Ramratan has been sentenced to death. The reason why Ramratan has been sentenced to death is that he was the man who shot Bhimsen. He was also the leader of this group and the enmity was directly between him and the members of the family of Jawanaram. We agree with the High Court that there are no extenuating 604 circumstances which would justify the reduction of sentence of death passed on Ramratan. The appeal therefore fails and is hereby dismissed. Appeal dismissed.

The appellants were convicted on a charge of murder on the sole testimony of one witness. Another prosecution witness deposed that the former witness told him immediately after the incident that the appellants were responsible for the murder. The question which arose was whether it was necessary for the former witness also to depose in Court that he had told the names of the murderers to the other witness immediately after the occurrence or whether his former statement be proved under s.157 of the Indian Evidence Act to corroborate his. testimony without his deposing about it in Court. Held, that it was not necessary under section 137 of the Evidence Act that the witness to be corroborated must also say in his testimony in court that he had made the former statement to the witness who was corroborating him. What s.157 required was that the witness to be corroborated must give evidence in court of some fact and if that was done his testimony in court relating to that fact could be corroborated by any former statement made by him relating to the same fact. Mt. Misri vs Emperor, A.I.R. 1934 Sind 100 and Nazar Singh vs The State, A.I.R. 1951 Pepsu 66, held as wrongly decided. As a general rule a court may act on the testimony of a single witness, though uncorroborated and the question whether corroboration of the testimony of a single witness was or was not necessary must depend on the circumstances of each case. Vemireddy Satyanarayan Reddy vs The State of Hyderabad, ; , distinguished. Vedivelu Thevar vs The State of Madras, ; , followed.

Appeal No. 92 of 59. Appeal from the judgment and order dated August 31, 1956, of the Orissa High Court in second appeal No. 1.5.1 of 1951. A. V. Viswanatha Sastri and T. V. R. Tatachari, for the appellant. M. section K. Sastri, for respondents. 674 1961. September 20. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This is an appeal by a certificate granted by the High Court of Orissa and it raises a short question about the scope and effect of the provisions of section 7 (1) of the Orissa Tenants Protection Act, 1948 (Act III of 1948) (hereafter called the Act). The appellant Magiti Sasamal sued the respondents Pandab Bissoi and others in the Court of the District Munsiff, Berhampur, for a permanent injunction restraining them from entering the suit lands belonging to the appellant. The appellants case was that the suit lands belonged to him and were in his personal cultivation for many years. In the year of the suit the appellant had cultivated the said lands as usual, manured and raised paddy crop thereon after spending a large amount in that behalf According to the appellant the respondents had no manner of right or title to the said lands and had never cultivated them. From the notice given by them to the appellant, however, it appeared that the respondents wanted to enter upon the lands forcibly and to remove the standing crop therefrom. This they desired to do by setting up a false claim that they were the tenants of the lands and as such were entitled to the protection of the Act. The appel lant alleged that the respondents were local rowdies and were known for their high handed action in the neighbourhood. On these allegations the appellant claimed a permanent injunction against the respondents. The respondents admitted the title of the appellant to the lands in suit but pleaded that they were the tenants in respect of separate portions of the said lands. Their version was that they had cultivated their holdings and raised the paddy crop thereon in the year in question. According to them they had been in cultivating possession of their respective holdings as tenants long before September 1, 1947, and so they were entitled to remain in possession as such tenants under the 675 they had filed petitions under the Act before the Sub Collector, Berhampur, claiming appropriate relief against the appellant. They urged that they were ever ready and willing to pay the Rajabhag as provided by the Act and they contended that the Suit was not maintainable in a civil court. On these pleadings the learned trial judge framed appropriate issues. Three issues of law had been framed by him on the pleas raised by the respondents. These issues were, however, not pressed at the hearing, One of them, namely issue 5, refers to the jurisdiction of the Court to try the suit in view of the provisions of the Act. Thus, it if; clear that the issue of jurisdiction was not pressed by the respondents at the trial. On the merits the learned trial judge considered the evidence and held that though the appellant was the owner of the property the respondents had proved that they were the tenants in possession of their respective holdings and that their possession was long before September 1, 1947. On these findings the learned judge came to the conclusion that the appellant was not entitled to claim an injunction against the respondents and so he dismissed his suit. The matter was then taken by the appellant before the District Judge, Ganjam, Nayagarh. The learned District Judge considered the evidence led by the parties and reversed the conclusions of the trial court. He held that the onus was on the respondents to prove their possession of their respective holdings as tenants on or before the specified date, and according to him they had failed to dis charge that onus. The question of jurisdiction was not raised before the appellate court by the respondents. Having held against the respondents on the merits the learned District Judge allowed the appeal, set aside the decree passed by the trial court and directed that an injunction should be issued against the respondents as claimed by the appellant. 676 The respondents then moved the High Court by second appeal ; and the main point which they urged before the High Court was that the learned trial judge had no jurisdiction to entertain the suit having regard to the provisions of section 7 (1) of the Act. The appellant pointed out to the High Court that this question of jurisdiction bad not been pressed before the trial court and had not been raised before the lower appellate court. Even so the High Court allowed the point to be raised and decided it in favour of the respondents. As a result of the finding that the civil court bad no jurisdiction to entertain the suit the second appeal preferred by the respondents has been allowed and the appellant 's suit dismissed with costs throughout. It is against this decree that the appellant has come to this Court with the certificate granted by the High Court; and the short point which has been raised before us on his behalf by Mr. Viswanatha Sastri is that in holding that the present suit is outside the jurisdiction of the civil court the High Court has misconstrued the scope and effect of the Provisions of section 7(1) of the Act. The Act received the assent of the Governor General on February 5, 1948 and was published on February 14,194S. It is a temporary Act and by s.1(4) it has been provided that it shall cease to have effect on April 15, 1949 except is respects things done or omitted to be done before the expiration thereof. It has been passed in order to provide for temporary protection to certain classes of tenants in the Province of Orissa. Legislature thought that the said tenants deserved protection and so as a beneficent measure the Act has been passed. Section 2(c) of the Act defines landlord and section 2(g) defines a tenant. The main operative provision of the Act is contained in section 3. This Section provides that not withstanding anything contained in any other law for the time being in force, or any express or implied agreement to the contrary, but subject to the provisions of this Act, 677 a person who, on the first day of September 1947, was cultivating any land as a tenant shall continue to have the right to cultivate such land and it shall not be lawful for the landlord to evict the tenant from the land or interfere in any way with the cultivation of such land by the tenant. It would thus be seen that the Act purports to provide protection to tenants who were in possession of lands on the appointed day which is September 1, 1947. The other sub sections of section 3 make material and subsidiary provisions in regard to the said protection. Section 7(1) reads thus: " 'Any dispute between the tenant and the landlord as regards, (a) tenant 's possession of the land on the 1st day of September, 1947 and his right to the benefits under this Act. or (b) misuse of the land by the tenant, or (c) failure of the tenant to cultivate the land properly, or (d) failure of the tenant to deliver to the landlord the rent accrued due within two months from the date on which it becomes payable, or (e) the quantity of the produce payable to the landlord as rent, shall be decided by the Collector on the application of either of the parties". The appellant contends that section 7(1) covers disputes between landlords and tenants which are specified under cls. (a) to (e) but it does not cover a dispute between the parties as to whether the relationship of landlord and tenant 'exists between them. It is only where such a relation ship is either admitted or established in a civil court that the specified disputes fall within the exclusive jurisdiction of the Collector on the other hand the respondents ' case is that the dispute as to the status of the tenant is also included under section 7(1). The High Court has upheld the respondents ' interpretation, and Mr. Viswanatha Sastri contends that this interpretation is based on a misconstruction of the section. It is true that having regard to the beneficent object which the Legislature had in view in passing the Act its material provisions should be liberally 678 construed. The Legislature intends that the 'disputes contemplated by the said material provisions should be tried not by ordinary civil courts but by tribunals specially designated by it, and so in dealing with the scope and effect of the jurisdiction of such tribunals the relevant words used in the section should receive not a narrow but a liberal construction. While bearing this principle in mind we must have regard to another important principle of construction, and that is that if a statute purports to exclude the ordinary jurisdiction of civil courts it must do so either by express terms or by the use of such terms as would necessarily lead to the inference of such exclusion. As the Privy Council has observed in Secretary of State vs Mask & Co., (1) "it is settled law that the exclusion of the jurisdiction of the civil courts is not to be readily inferred, but that such exclusion must either be explicitly expressed or clearly implied". There can be no doubt that ordinarily a dispute in regard to the relationship between the parties such as that between a landlord and a tenant would be a dispute of a civil nature and would fall within the competence of the civil court. If the respondents contend that the jurisdiction of the civil court to deal with such a civil dispute has been taken away by section 7 (1) we must enquire whether section 7(1) expressly takes away the said jurisdiction or whether the material words used in the section lead to such an inference or the scheme of the Act inescapably establishes such an inference. The relevance and materiality of both these principles are not in dispute. Let us then revert to section 7. It would be noticed that a. 7(1) has expressly and specifically provided for five categories of disputes which are within the jurisdiction of the Collector and which must therefore be taken to be excluded from the jurisdiction of the civil court. On a reasonable construction of section 7(1) a dispute specified by section 7(1)(a) would be a dispute between a tenant and a landlord in regard (1) (1940) L. R. 67 1. A. 222, 236. 679 to the former 's possession of the land on September 1, 1947. It is clear that the dispute to which section 7(1)(a) refers is a narrow dispute as to the possession of the tenant on a specific date and his consequential right to the benefits of the Act. The same is the position with regard to the other categories of the dispute specified by section 7(1). In none of the said categories is a dispute contemplated as to the relationship of the parties itself. In other words section 7(1) postulates the relationship of tenant and landlord between the parties and proceeds to provide for the exclusive jurisdiction of the Collector to try the five categories of disputes that may arise between the landlord and the tenant. The disputes which are the subject matter of section 7(1) must be in regard to the five categories. That is the plain and obvious construction of the words "any dispute as regards". On this construction it would be unreasonable to hold that a dispute about the status of the tenant also falls within the purview of the said section. The scheme of section 7(1) is unambiguous and clear. It refers to the tenant and landlord as such and it contemplates disputes of the specified character arising between them. Therefore, in our opinion, even on a liberal construction of section 7(1) it would be difficult to uphold the argument that a dispute as regards the existence of the relationship of landlord and tenant falls to be determined by the Collector under section 7(1). In this connection it would be relevant to take into consideration the provisions of section 7(2). This clause provides that the Collector may, after making such enquiries as he may deem necessary, order the tenant, by a notice served in the prescribed manner and specifying the grounds on which the order is made, to cease to cultivate the land. It is significant that the making of the enquiry and its mode are left to the discretion of the Collector. If a serious dispute as to the existence of the relationship of landlord and tenant between the parties had been covered by section 7(1) it is difficult to imagine that the 680 Legislature would have left the decision of such an important issue to the Collector giving him full freedom to make such enquiries as he may, deem necessary. As is well known, a dispute as to the existence of the relationship of landlord and tenant raises serious questions of fact for decision, and if such a serious dispute was intended to be tried by the Collector the Legislature would have provided for an appropriate enquiry in that behalf and would have made the provisions of the Code of Civil Procedure applicable to such an enquiry. Section 7(2) can be easily explained on the basis that the relationship between the parties is outside section 7(1) and so the disputes that are covered by section 7(1) are not of such a nature as would Justify a formal enquiry in that behalf The provisions of sub sections (3), (6) and (7) also indicate that the relationship between the parties is not, and cannot be, disputed before the Collector. The parties arrayed before him are landlord and tenant or vice versa, and it is on the basis of such relationship between them that he proceeds to deal with the disputes entrusted to him by section 7(1). It is true that when the relationship of landlord and tenant is proved or admitted the disputes falling within the five categories enumerated in section 7(1) will have to be tried by the Collector. Let us take the present case itself to illustrate how section 7(1) will operate. In the suit filed by the appellant against the respondents the issue about the status of the respondents was framed and so it had to be tried by the civil court. In such a suit if the civil court holds that the relationship between the landlord and the tenant had not been established it may proceed to deal with the suit on the merits. If, however, it holds that the said relationship is established then the civil court cannot deal with the dispute between the parties if it falls within any one of the categories specified by section 7(1). In such a case, having made the finding about the relationship between the parties the civil court will either dismiss the suit on the ground that it can give no relief to 681 the landlord, or may, if it is permissible to do so, return the plaint for presentation to the Collector. What course should be adopted in such a case it is unnecessary for us to decide in the present appeal. All that we wish to emphasise is that the initial dispute between the parties about the relationship subsisting between them will still continue to be tried by the civil court and is outside the purview of section 7(1). In support of the argument that a dispute as to the existence of relationship as landlord and tenant should be taken to be included under section 7(1) reliance is placed on the provisions of section 8(1) of the Act. Section 8(1) provides that subject to the provisions of section 7 all disputes arising between landlord and tenant shall be cogniscible by the revenue court and shall not be cogniscible by the civil court. It must be pointed out that we are really not concerned with section 8(1) in the present appeal because even according to the respondents the present dispute between the parties attracted section 7(1.) and should have been tried by the Collector and not by 'the civil court. However, the question about the construction of section 8(1) has been incidentally raised before us. In appreciating the scope and effect of section 8(1) it is necessary to bear in mind the provisions of section 13 of the Act. The said section provides that the Act shall, as far as may be, read and construed. as forming part of the Madras Estates Land Act, 1908, or as the case may be, of the Orissa tenancy Act, 1913. Therefore reading the provisions of section 8(1) and section 13 tog other it follows that all that section 8 (1) provides is that except for the disputes covered by section 7 (1) all disputes arising between landlord and tenant shall be cogniscible by the revenue court and to the trial of such disputes by the revenue court the relevant provisions of the Orissa Tenancy Act, 1913 would apply. It is true that disputes to which section 8(1) applies are entrusted to the exclusive jurisdiction of the revenue courts and are excluded from the jurisdiction of civil courts, but the effect of this 682 the other relevant provisions of the parent Act of which this temporary Act forms a part. Now, if we turn to some of the relevant provisions of the, parent Act it would be clear that when the revenue courts are given jurisdiction to try the disputes the enquiry held by them purports to be a formal enquiry to which the provisions of the Code of Civil Procedure may apply (Vide: section 192 of the Orissa Tenancy Act, 1913). Similarly, the provisions of section 204(1) which provides for appeals contemplate appeals to the District Court and the High Court where questions of title are involved. These provisions illustrate the point that where serious disputes about title are entrusted to special tribunals usually the Legislature contemplates a formal en quiry and makes the provisions of the Code of Civil Procedure applicable to such an enquiry and provides for appropriate appeals. Now, in regard to the order passed by the Collector under section 7(1) the only provision about appeals is that made by section 11 which provides that an appeal shall lie to the prescribed superior revenue authority whose decision shall be final, and shall not be subject to any further appeal or revision. Departure made by the Legislature in providing only one appeal and that too in every case to the prescribed superior revenue authority clearly brings out that the disputes which are entrusted to the Collector under section 7(1) axe the simple disputes specified in the five categories and do not include a serious dispute like that of the relation,ship between the parties as landlord and tenant. , If such a dispute had been intended to be tried by the Collector the Legislature would have provided for a formal enquiry and would have prescribed appropriate appeals on the lines of sections 192 and 204 of the parent Act. In this connection we may in passing refer to the provisions of section 126 of the parent Act. This section deals with the jurisdiction of civil courts in matters relating to rent. Section 126(3) provides for the institution of suits in civil courts on the 683 grounds specified by cls. (a) to (g). Clause (c) deals with the ground that the relationship of landlord and tenant does not exist. This clause shows that if a dispute arose between the parties as to the existence of the relationship of landlord and tenant a suit in a civil court a.% contemplated is prescribed by section 126(3) (c). That also has some bearing on the construction of section 7(1); and it is for that limited purpose that we have referred to it. Therefore, we are satisfied that the High Court was in error in holding that under a. 7(1) of the Act it was competent to the Collector to try the issue between the appellant and the respondents whether or not the Respondents were the tenants of the appellant and that the civil court had no jurisdiction to entertain the said dispute. In the result, the appeal must be allowed, the order passed by the High Court set aside and that of the District Court restored with. costs throughout. Appeal allowed.

The appellant filed in the Civil Court a suit for permanent injunction restraining the respondents from entering the lands in suit on the allegation that the lands belonged to him and were in his cultivatory possession for many years and that the respondents had no right or title to them and had never cultivated them. The respondents contended that they were tenants of portions of the said lands and were in cultivating possession of the same as tenants. The question which arose for decision was whether having regard to the provisions of section 7(1) of the Orissa Tenants Protection Act, 1948, the Civil Court had jurisdiction to entertain the suit which involved a dispute as to the relationship of landlord and tenant between the parties. Held, that even on a liberal construction of section 7(1) of the Act it cannot be held that disputes as regards the existence of the relationship of landlord and tenant fall to be deter mined by the Collector under that section. Disputes which are entrusted to the Collector under section 7(1) are the simple disputes specified therein in the five categories and do not include a serious dispute as to the relationship between the parties as landlord and tenant. In the present case the suit was therefore within the jurisdiction of the Civil Court. Secretary of State vs Mask & Co. (1940) L.R. 67 I.A. 222, referred to.

Appeal No. 563 of 1960. Appeal by special leave from the judgment and decree dated March 20, 1959, of the Patna High Court in Election appeal No. 8 of 1958. J. C. Sinha, D. P. Singh, M. K. Ramamurthi, R. K. Garg and section C. Agarwala, for the appellant. B. C. Ohosh and R. C. Datta, for respondent No. 1. Udaipratap Singh and P. C. Agarwala, for respondent No. 2. 1961. September 22. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. Badri Narain Singh, the appellant, and four other persons including Kam Deo Prasad, respondents, were candidates to the Bihar Legislative Assembly during the last general election held in 1957. Two of those candidates withdrew before the relevant date. The appellant secured the largest number of votes and was declared elected on March 14, 1957. Respondent No. 2 secured larger number of votes than 761 Kam Deo Prasad, respondent No. 1, who filed an election petition under sections 80 and 81 of the Representation of the People Act, 1951 (Act XLIII of 1951) challenging the election of the appellant, on the ground that the nomination of the appellant and respondent No. 2, who, as Ghatwals, held an office of profit, was against the provisions of section 7 of the Act, and that the appellant had also committed corrupt practices. Kam Deo Prasad, by his election peti tion, not only prayed for the declaration that the ,election of the appellant was void, but also for the declaration that he himself was duly elected. The appellant denied the allegations against him. The Election Tribunal held that Badri Narain Singh, the appellant, was guilty of corrupt practices and that a Ghatwal was not a holder of an office of profit under the State of Bihar. It therefore set aside the election of the appellant, but did not grant the dec laration that Kam Deo Prasad was a duly elected candidate. The appellant filed Election Appeal No. 7 of 1958 in the High Court of Judicature at Patna, against the order of the Election Tribunal setting aside his election, and prayed that the order of the Election Tribunal be set aside and that it be held that he had been duly elected. Kam Deo Prasad also filed Election Appeal No. 8 against the order of the Election Tribunal not declaring him to be the duly elected candidate and prayed for a declaration that he, had been duly elected. The grounds of appeal questioned the correctness of the finding of the Election Tribunal that Badri Narain Singh and respondent No. 2, as Ghatwals, were not the holders of offices of profit and that Kam Dec) Prasad could not be declared duly elected. Both these appeals were disposed of by the High Court by one judgment. It did not accept the finding of the Election Tribunal that Badri Narain Singh had committed any corrupt practice and accepted the contention for respondent No. 1 that Badri Narain Singh and respondent No. 2 held 762 offices of profit under the Bihar Government as they were Ghatwals. It was in this view of the matter that it confirmed the order of the Election Tribunal setting aside the election of the appellant and allowing the appeal of respondent No. 1, declared him duly elected. The concluding portion of the judgment of the High Court may be usefully quoted here : "To conclude, the election of the returned candidate is not valid, and the order of the Tribunal is, therefore, right, though on different grounds. Further, there, was only one seat, and three persons contested it, namely, the petitioner and the two respondents. The two respondents were disqualified for being chosen as, and for being, members of Legislative Assembly or Legislative Council of the State, and, therefore, their nomination papers were not validly accepted. If their nomination papers are rejected, and it cannot but be rejected, the only person left in the field was the petitioner Kam Deo Prasad Singh, and, therefore, be must be declared to be duly elected. In the result, Election Appeal No. 7 of 1958 is dismissed, and Election Appeal No. 8 of 1958 is allowed, and Kam Deo Prasad Singh is declared to be duly elected to Bihar Legis lative Assembly from the Sarnath State Assembly Constituency in the district of Santal Parganas. " As a result of this order, separate decrees were As a result of this order, separate decrees were As a result of this order, separate decrees were prepared in the two appeals. Decree in Election Appeal No. 7 said, 'It is ordered and decreed that this appeal be and the same is hereby dismissed '. The decree in appeal No. 8 said, 'It is ordered and decreed that this appeal be and the same is hereby allowed and Kam Deo Prasad Singh is declared to be duly elected to the Bihar Legislative Assembly from the Sarnath State Assembly constituency in the District of Santhal Parganas '. 763 The appellant has filed this appeal by special leave against the order in Election Appeal No. 8 of 1958. All the grounds of appeal relate to the finding of the High Court that the office of a Ghatwal is an office of profit. The petition for special leave to appeal does not mention the relief the appellant seeks from this Court. Presumably, he prays for the setting aside of the order in Appeal No. 7 confirming the order of the Election Tribunal setting 'aside his election and also the order in Appeal No. 8. A preliminary objection has been taken on behalf of respondent Kam Deo Prasad Singh that this appeal is incompetent as barred by the principle of res judicata inasmuch as the appellant did not appeal against the order of the High Court in Appeal No. 7 whose dismissal by the High Court confirmed the order of the Election Tribunal setting aside the election of the appellant. It is urged that the order setting aside the appellant 's election having become final, it cannot be set aside and that the finding arrived at in that appeal about a Ghatwal being a holder of an office of profit operates as res judicata in this appeal and therefore no appeal against the order in Appeal No. 8 declaring respondent No. 1 to be the duly elected candidate can be pressed on the ground that the view of the High Court about the appellant 's holding an office of profit is wrong. If the correctness of that view cannot be challenged, the correctness of the declaration in favour of respondent No. 1 cannot be challenged in this appeal on any other ground when no other ground had been taken in the application for special leave. The contention in effect, therefore, is that it is not open to the appellant in this appeal to question the correctness of the finding that he held an office of profit under the Bihar Government, a finding which formed the basis of the dismissal of Appeal No. 7 and the confirmation of the order setting aside his election. 764 The learned counsel for the appellant relied on the judgment of this Court in Narhari vs Shankar(1) in support of his contention that the judgment in Election Appeal No. 7 cannot operate as res judicata in this appeal. That case is distinguishable on facts and is with respect to the interpretation of section 11 of the Code of Civil Procedure. In the suit. , in that case, the plaintiffs claimed possession over 2/3rds of the plot No. 214. They claimed 1/3rd which was in the possession of ' one set of defendants, namely, defendants ,Nos. 1 to 4 and the other 1/3rd was in possession of another set of defendants, namely, defendants Nos. 5 to 8. Each set of defendants claimed that they were entitled to the land in their possession as their share of the family property and denied the allegations of the plaintiffs that the senior branch was under custom entitled to exclusive possession of the plot which was Inamland. The suit was decreed by the trial Court. Each set of defendants then filed an appeal claiming 1/3rd of the plot. The first appellate Court allowed both the appeals and dismissed the plaintiffs suit by one judgment and ordered a copy of the judgment to be placed on the file of the other connected appeal. Naturally, it decided the one point of contention common to both the appeals, namely, that the senior branch was not entitled to exclusive possession of the plot. This was the finding in each of the appeals. The plaintiffs thereafter filed two appeals to the High Court, one against the decree in the appeal filed by defendants Nos. 1 to 4 and the other against the decree in the appeal filed by defendants Nos. 5 to 8. The latter appeal was filed beyond limitation and the High Court refused to condone the delay. It was contended at the hear ing of the appeal that the second appeal was filed (1) ; 765 beyond the period of limitation and was not maintainable and that when it was dismissed as not maintainable the first appeal would we barred by the principle of res judicata. The High Court agreed with the contention, dismissed the second appeal as time barred and the first on the ground that the judgment in the appeal by the defendants Nos. 5 to 8 operated as res judicata. The plaintiffs then filed two appeals to the Judicial Committee of the Hyderabad State and, ultimately, they were disposed of by this Court in view of article 374(4) of the Constitution. The plaintiffs had impleaded all the defendants as respondents in their first appeal to the High Court. They had paid the full court fee necessary for an appeal against the dismissal of the entire suit. Their prayer covered both the appeals. This indicated that it was sought to be an appeal against the dismissal of the entire suit. It is not clear whether the common judgment passed by the first appellate Court specifically stated that ,it dismissed the plaintiffs suit with respect to one third of the plot by its order allowing one appeal and dismissed the suit with respect to the other one third by its order allowing the second appeal. Possibly it just said that as a result of its finding the appeals are allowed and the plaintiffs ' suit is dismissed and that such an order led the plaintiffs to actually file one appeal against all the defendants and against the dismissal of the entire suit. The prayer in the first appeal covered the subject matter of both the appeals. Thus the first appeal was really a consolidated appeal against the decrees in both the appeals and could have been split up for the purposes of record into two separate appeals. This Court itself felt that the circumstances of the case were such that the High Court should have allowed the benefit of section 5 of the Limitation Act to the appellant. 766 It was in these circumstances that this Court observed, at page 757 : "It is now well settled that where there has been one trial, one finding, and one decision, there need not be two appeals even though two decrees may have been drawn up. " This does not mean that whenever there be more than one appeal arising out of one suit, only one appeal is competent against the order in Any. of those appeals irrespective of the fact whether the issues for decision in those appeals were all common or some were common and others raised different points for determination. The existence of one finding and one decision mentioned in this observation simply contemplates the presence of common points in all the appeals and the absence of any different point in those appeals, and consequently of one decision on those common points in all the appeals. This Court, further observed at page 758: "The question of res judicata arises only when these are two suits. Even when there are two suits it has been held that a decision given simultaneously cannot be a decision in the former suit. When there is only one suit, the question of res judicata does not arise at all and in the present case, both the decrees are in the same case and based on the same judgment, and the matter decided concerns the entire suit. As such there is no question of the application of the principle of res judicata. " These observations do not apply to cases which are governed by the general principles of res judicata which rest on the principle that a judgment is conclusive regarding the points decided between the same parties and that the parties should not be vexed twice over for the same cause. We are therefore of opinion that both in view of the facts of the case and the provision of law 767 applicable to that case, that case can be no guide for determining the question before us in this appeal. It is true that both the appeals Nos. 7 and 8 before the High Court arose out of one proceeding, before the Election Tribunal. The subject matter of each appeal was, however, different. The subject matter of appeal No. 7 filed by the appellant related to the question of his election being bad or good, in view of the pleadings raised before the Election Tribunal. had nothing to do with the question of right of respondent No. 1 to be declared as duly elected candidate. The claim on such a right is to follow the decision of the question in appeal No. 7 in case the appeal was dismissed. If appeal No. 7 was allowed, the question in appeal No. 8 would not arise for consideration. The subject matter of appeal No. 8 simply did not relate to the validity or otherwise of the election of the appellant. It related to the further action to be taken in case the election of the appellant was bad, on the ground that a Ghatwal holds an office of profit. The decision of the High Court in the two appeals, though stated in one judgment, really amounted to two decisions and not to one decision common to both the appeals. It is true that in his appeal No. 8, the respondent No. 1 had referred to the rejection of his contention by the Election Tribunal about the appellant and respondent No. 2 being holders of an office of profit. He had to challenge the finding on this point because if he did not succeed on it, he could not have got a declaration in his favour when respondent No. 2 was also in the field and had secured a larger number of votes. He could, however, rely on the same contention in supporting the order of the Election Tribunal setting aside the election of the appellant and which was the subject matter of Appeal No. 7. This contention was considered by the High Court in Appeal No. 7 in that context and it was therefore that even though the 768 High Court did not agree with the Election Tribunal about the appellant 's committing a corrupt practice, it confirmed the setting aside of his election on the ground that he held an office of profit. The finding about his holding an office of profit served the purpose of both the appeals, but merely because of this the decision of the High Court in each appeal cannot be said to be one decision. The High Court came to two decisions. It came to one decision in respect of the invalidity of the appellants election in Appeal No. 7. It came to another decision in Appeal No. 8 with respect to the justification of the claim of respondent No. 1 to be declared as a duly elected candidate, a decision which had to follow the decision that the election of the appellant was invalid and also the finding that respondent No. 2, as Ghatwal, was not a properly nominated candidate. We are therefore of opinion that so long as the order in the appellant 's appeal No. 7 confirming the order setting aside his election on the ground that he was a holder of an office of profit under the Bihar Government and therefore could not have been a properly nominated candidate stands, he cannot question the finding about his holding an office of profit, in the present appeal, which is founded on the contention that finding is incorrect. We therefore accept the preliminary objection and dismiss the appeal with costs. Appeal dismissed.

The Election Tribunal on the petition of the first res pondent set aside the election of the appellant holding that the appellant as a Ghatwal, was not a holder of office of profit, and t hat he was guilty of corrupt practices. The Election Tribunal however did not entertain the first respondent 's prayer to declare him as duly elected. The ' appellant and the first respondent, both went up in appeal to the High Court. Appellants appeal being No ' 7 was against the order setting aside his election. The first respondent 's appeal being No. 8 was against the order not declaring him to be duly elected. Both the appeals were disposed of by the High Court by one judgment. The appellant 's appeal No. 7 was dismissed holding that the appellant was not guilty of corrupt practices and that be, as a Ghatwal, held an office of profit. The respondent 's appeal No. 8 was allowed declaring him as duly elected. Two separate decrees were prepared in the two appeals. The appellant filed this appeal by special leave from the order in Appeal No. 8 by the first respondent. All the grounds of the appeal related to the finding of the High Court that the office of Ghatwal was an office of profit. A preliminary objection was taken on behalf of the first respondent that this appeal was incompetent as barred by the principle of res judicata inasmuch as the appellant did not appeal against the order of the High Court in Appeal No. 7 whose dismissal by the High Court confirmed the order of the Election Tribunal setting aside the election of the appellant; and that it was not open to the appellant to question the correctness of the finding that he held an office of profit, which was the basis of the dismissal of appeal No. 7. Held, that where two appeals arose out of one proceeding, but the subject matter of each, appeal was different, the 760 decision of the High Court in the appeals though stated in one judgment, really amounted to two decisions and not to one derision common to both the appeals. The subject matter of Appeal No 7 filed by the appellant related to the question of his election being bad or good. The subject matter on appeal No. 8 did not relate to the validity or otherwise of the election of the appellant. It related to the further action to be taken in case the election of the appellant was bad, on the ground that ' a Ghatwal holds an office of profit. The High Court came to two decisions, one in respect of the invalidity of the appellant 's election in appeal No. 7. It came to another decision in appeal No. 8 with respect to the justification of the claim of the first respondent to be declared as a duly elected candidate. That so long as the order in the appellant 's appeal No. 7 confirming the order setting aside his election on the ground that he was a holder of an off ice of profit stands, he cannot question that finding in the present appeal, preferred against the decree in the first respondent 's appeal No. 8. Narhari vs Shankar ; , distinguished.

Appeal No. 328 of 1961. Appeal by special leave from 'the judgment and order dated February 2, 1961, of the Punjab High Court (Circuit Bench), at Delhi 'in Civil Revision Application No. 135 D of 1957. Din Dayal Sharma and N, N. Keswami, for the appellant. K. Daphtary, Solioitor General of India, V. D. Mahajan and T.M. Sen, for the respondent. September 25. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. The principal point which this appeal by special leave raises for our decision relates to the construction of sections 32 and 33 of the (10 of 1940) (hereafter called the Act). That question arises in this way. The respondent, Union of India, filed a petition in the Court of the First Class Sub Judge at Delhi against the appellant M/s J. Burman & Co., through its proprietor Jawahar Lal Burman under sections 33 and 28 of the Act. The respondent alleged that a concluded contract had been entered into between the parties on August 31, 1949 for supply of 170 1/2 Cwt. of cocoanut oil by the appellant to the respondent. The respondent had advertised in the Indian Trade Journal for the said supply and the appellant had submitted its tender No. SM I/1104524. 772 This tender was accepted by the respondent which concluded a contract between the parties. The respondent 's case 'was that the said contract was governed by general conditions of contract Form W. 'S.B. 133. , These conditions included an arbitration 'agreement, 'Disputes arose between the parties regarding the said contract, and so in pursuance of the arbitration agreement they were referred to the two arbitrators appointed by the parties. After ,the arbitration propeedings had gone. on for, a considerable time before the arbitrators the appellant objected to their jurisdiction to , deal. with the disputes on the ground: that there was No. concluded contract between the parties. This plea made it necessary for the respondent to move the Court for a decision of the question about the; existence and validity of the arbitration 'agreement. It, was on these allegations that the respondent in its petition claimed 'that it may, be held that there was a concluded contract between ': the parties containing a valid arbitration agreement. The petition having been made under section 28 along with section 33 the respondent prayed that suitable extension of time be granted to the Arbitrators for making the, award. The appellant pleaded in defence that no concluded contract had been made between the parties and that there was no jurisdiction: in the Court to grant extension under s 28. The, other allegations made by the respondent in its petition were also traversed. On these pleadings the learned trial judge framed, appropriate issues. He found that a concluded contract had been proved, between the parties as alleged by the respodent. that there was a valid arbitration agreement in the said contract and that the Court had jurisdiction, to. try the petition. Incidentally, it may be pointed out at this stage that no specific point had been raised in the pleadings of the appellant that, the Court had no jurisdiction to entertain the petition under section 33 or. section 32 of the Act,. In fact the trial judge has observed that it was not shown to him how the 773 application was incompetent. Consistently with the findings recorded by him the learned trial judge declared that there was a concluded contract between the parties under which the matter was duly referred to arbitration through an arbitration agreement clause in the contract. As a result of the declaration he held that there was a valid reference to arbitration between the parties. Consequently he granted a month 's time to the arbitrators to make their award. This decision was challenged by the appellant by its revision petition preferred in. the High Court of Punjab at Chandigarh. The High Court has confirmed the finding of the trial court that there was a concluded contract which contained an arbitration agreement. The question of 'jurisdiction under section 33 of the Act was argued before the High Court and its attention was drawn to the conflict of judicial decisions on. the point. The High Court, however, held that since the petition has been filed as a composite application under sections 28 and 33 it was open to the Court under a. 28 to enter upon the question of the existence or validity of the contract and so there was no substance in the point of 'jurisdiction raised by the appellant. In the result the appellant 's revision application was dismissed. It is against this decision that the appellant has come to this Court by special leave ; and on his behalf Mr. Din Dayal has raised the same two points for our decision. He contends that the High Court was in error in holding that the trial court bad jurisdiction to entertain the respondent 's petition, and he argues that even if the point of jurisdiction raised by him fails it should be held that there was no concluded contract between the parties and so. there was no scop or room for making any reference to arbitration. The first of these two contentions has been seriously pressed before us. Before dealing with, the question of jurisdiction it is necessary to recall the material facts which 774 have led to the present dispute. The appellant and the respondent nominated their arbitrators. The arbitrators heard the matter at length and the proceedings bad reached a stage when an award might have been pronounced. It was then that the appellant chose to obstruct the further progress of the proceedings by raising the plea that there was no concluded contract. Even then he refused to apply under section 33 and so a stalemate issued because the arbitrators ' were not entitled to proceed further with the arbitration proceedings in view of the point raised by the appellant. It is necessary to bear in mind this background of the dispute in considering the point of jurisdiction. The question of jurisdiction raised by the appellant has to be answered in the light of the construction which can be reasonably placed on the material provisions of sections 32 and 33 of the Act. It may be conceded at the outset that the question thus raised presents some difficulty. Sections 32 and 33 read thus: "32. Notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be set aside, amended, modified or in any way affected otherwise than as provided in this Act. Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits: Provided that where the Court deems it just and expedient, ' it may set down the application for hearing on other evidence 775 also, and it may pass such orders for dis covery and particulars as it may do in a suit. " In appreciating the effect of these two provisions it would be relevant to remember that the object of the Legislature in enacting the two sections quite clearly was to prevent the abuse of the process of the Court. Before the present Act was passed experience showed that unscrupulous and dishonest parties to the arbitration agreements frequently chose to deny the existence of the said agreements even after the arbitration proceedings had concluded and ended in awards and that tended to make all arbitration proceedings futile. More often than not these pleas ultimately failed but it meant considerable delay and waste of time and substantial expense. That is why sections 32 and 33 have been enacted with the object of bringing the relevant disputes for decision before the specified Courts in the form of petitions. It is significant that under s.31(2) of the Act all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the agreement or persons claiming under them shall be decided by the Court in which the award under the agreement has been, or may be, filed, and by no other Court. Indeed, s.2(c) defines a Court as meaning a Civil Court having jurisdiction to decide the questions forming the subject matter of the reference if the same had been the subject matter of a suit, but does not, except for the purpose of arbitration proceedings under section 21, include a Small Cause Court. Therefore, stated broadly, it would be correct to assume that the main object of introducing the new provisions of sections 31, 32 and 33 was to entrust the decision of the relevant disputes to the specified Court and to require the parties to bring the ,said disputes for the decision of the said Court in the form of petitions. Remedy by a regular suit is intended to be excluded. 776 Section 32 creates a bar against the institution of suits, and it provides that if the existence effect or validity of an arbitration agreement or award is in dispute on any ground whatsoever no suit shall lie for the adjudication of the said dispute. It also provides that no suit shall lie to set aside, amend or modify or in any way affect an arbitration ' agreement or an award. It would be noticed that the clause "on any ground whatsoever" is very wide and it denotes, inter alia, that if the existence or validity of an arbitration agreement is questioned on any ground whatever it cannot be the subject matter of a suit; the said dispute shall be tried as provided in this Act. Thus there can be no doubt, that if a party affirms the existence of an arbitration agreement or its validity it is not open to the party to file a suit for the purpose of obtaining a declaration about the existence of the said agreement or its validity. Such a suit in terms is barred by section 32. This position is. not disputed. The bar to the suit thus created by section 32 inevitably raises the question as to what remedy it is open to a party to adopt in order to obtain an appropriate declaration about the existence or validity of an arbitration agreement; and it is on the decision of this question that the parties are at issue before us. Before answering this question we may conveniently consider the scope of section 33 and its effect. Section 33 consists of two parts. The first deals with a challenge to the existence or validity of an arbitration agreement or an award, and it provides that the persons there in specified can apply to the Court to have a decision on its challenge to the existence or validity of an arbitration agreement or an award. In other words, there is no doubt that it is only persons who challenge the existence of the arbitration agreement that can apply under the first part of section 33. This position is also not disputed. The second part of the section refers to applications made to have the effect of either the arbitration agreement or the award determined. The question 777 which we have to consider is whether a person affirming an arbitration agreement can apply under the latter part of section 33. Even assuming that the requirement that an application can be made under the first part of section 33 only by persons desiring to challenge the arbitration agreement does not apply to its latter part, it is difficult to hold that an application to have the effect of the arbitration agreement determined can legitimately cover the dispute as to the existence of the said arbitration agreement. It is clear that the first part of section 33 refers to the existence or validity in terms and sections 31 and 32 also refer separately to the existence effect or validity. Therefore, the effect of an arbitration agreement is treated as distinct from the existence of the agreement, and where it was intended to refer to the existence as well as the effect of such an agreement both the words "existence and effect" have been specifically used. Thus, under the latter part of section 33 an application can be made to have the effect or purport of the agreement determined but not its existence. That means that an application to have the effect of the agreement can be made provided the existence of the agreement is not in dispute. Besides, if a person affirming the existence of an agreement is held entitled to apply to the Court under the latter part of s.33 for getting a declaration about the said existing agreement then the first part of section 33 would be wholly superfluous. Therefore, it seems to us that a party affirming the existence of an arbitration agreement cannot apply under section 33 for obtaining a decision that the agreement in question exists. In fairness we ought to add that the learned Solicitor General, who appeared for the respondent, did not dispute this position. If the party affirming the existence of an arbitration agreement cannot apply under s.33 what is the remedy open to him? This question takes us back to section 32. If section 32 has created a bar against the institution of a suit for obtaining 778 a declaration about the existence of an arbitration agreement, unless it is held that the creation of the said absolute bar itself involves the right to make an application under the Act it would lead to the anomalous result that a party is given no remedy to enforce the right ; and it is an ordinary rule of construction that such an unreasonable and unconscionable result should as far as possible be avoided because the Legislature could not have intended such a result. In our opinion, having regard to the scheme of sections 31, 32 and 33 it would not be unreasonable to hold that in matters which fall within the bar created by s.32 if a suit cannot be filed it 119 necessarily intended that an application can be made and such an application can be made under the Court 's powers provided for by s.31 and impliedly recognised by section 32. On this construction section 33 cannot be treated as exhaustive of all cases where applications can be made. The Legislature has provided for the said cases under section 33 because it was thought that they represented the usual type of cases which arise under the arbitration agreements. 'A contrary view would lead either to a stalemate or would in substance compel the party affirming the existence of an agreement to forego the procedure prescribed by the said agreement and sue on the, contract itself. We are satisfied that a fair construction of sections 31, 32 and 33 does not lead to such an anomalous position. Mr, Din Dayal contends that there is really a lacuna in the Act inasmuch as having created a bar by section 32 the Legislature has failed to provide a remedy by way of an application. On reading sections 31, 32 and 33 together we do not think the Court is driven to the conclusion that there is a lacuna in the Act. In this connection it is material to remember that even in dealing with applications under the first part of section 33 the Court may accept the opponent 's plea and hold that the arbitration agreement exists if the challenge to the said existence set out in the petition is rejected. In other words, in many 779 cases applications made under the first part of a. 33 may end in the finding that the arbitration agreement exists. Similarly, in applications made under s.20 of the Act, if a dispute arose as to the existence of the arbitration agreement the Court may find in favour of the existence and make an order of reference as contemplated by a. 24. Thus, it is clear that in the applications expressly provided for by these two sections a party affirming the existence of the agreement would be entitled to prove the said existence, and if he succeeds he would obtain a decision to that effect. Therefore, in holding that section 32 impliedly recognises the inherent jurisdiction of the Court to entertain applications made by the parties affirming the existence of arbitration agreements we are bringing the provisions of s.32 in line with the provisions of sections 33 and 20. Indeed, section 33 is a corollary of section 32 and in a sense deals by way of illustration with the most usual type of cases arising in arbitration proceedings. Section 28 of the Act has no material bearing on the decision of this point. The power to enlarge time for making the award which is the subject matter of the provisions of section 28 cannot be hold to include a power to entertain petitions like the present. Indeed, the learned Solicitor General has not attempted to justify the conclusion of the High Court that s.28 confers such a power. Even if it is held that there is inherent jurisdiction in the Court to entertain an application in support of the existence of an arbitration agreement the question still remains whether an application can be made under such inherent jurisdiction for a declaration that the contract which includes the arbitration agreement as defined by section 2(a) includes cases where the arbitration agreement is made a part of the contract itself. The argument is that though an application may be made under the inherent jurisdiction of the Court to obtain a declaration about the existence or validity of an arbitration agreement, no such application can be 780 made to obtain a declaration about the existence or validity of the main contract itself. In dealing with this argument it would be necessary to have regard to the substance rather than the form of the matter. In the present case the respondent claims that there is a concluded contract between the parties and that the said contract contained a valid arbitration agreement. Looking *at the substance of the matter the prayer was first in regard to the existence and the validity of the main contract leading upto the second and principal prayer that there was a valid arbitration agreement. Quite clearly the decision of this question cannot depend merely on the words used in the petition. Where the challenge to the contract made by the appellant in defence to the claim of the respondent is a challenge common to both the contract and the arbitration agreement, the petition, like the One made by the respondent, must in substance be held to be a petition for a declaration as to the existence of a valid arbitration agreement; and a suit to obtain such a declaration is clearly barred by section 32. Therefore, in our opinion, the fact that an incidental declaration is claimed about the existence and validity of the main contract does not affect the essential character of the application. It is an application for obtaining a declaration about the existence and validity of an arbitration agreement. It is true that an arbitration agreement included in the contract itself is in one sense an integral part of the contract and in another sense it may be distinct from it. As observed by Lord Macmillan in Hayman vs Darwins, Ltd.(1), "the arbitration clause is quite distinct from the other clauses. The other clauses set out the obligations which the parties undertake towards each other hinc inde; but the arbitration clause does not impose on one of the parties an obligation in favour of the other. It embodies the agreement on both the parties that, if any dispute arises with regard to (1) section C. at p. 347. 781 the obligations which the one party has undertaken to the other, such dispute shall be settled by a tribunal of their own constitution. Moreover, there is this very material difference that whereas in any ordinary. contract the obligations of the parties to each other cannot in general be specifically enforced and breach of them results only in damages, the arbitration clause can be specifically enforced by the machinery of the Arbitration Acts". It is, therefore, theoretically possible that a contract may come to an end and the arbitration agreement may not. It is also theoretically possible that the arbitration agreement may be void and yet the contract may be valid; and in that sense there is a distinction between the arbitration agreement and the contract of which it forms a part; but, as we have already pointed out, in the present case, the challenge to the contract itself involves a challenge to the arbitration agreement; if there is a concluded contract the arbitration agreement is valid. If there is not a concluded contract the arbitration agreement is invalid. In such a case a prayer for a declaration of the existence of the contract and its validity inevitably leads to the consequential prayer about the existence and validity of the arbitration agreement. If that is so, a suit cannot lie for a declaration that the arbitration agreement is valid because the prayers that the respondent has made in the present case fall directly within the clause ",on any ground whatsoever". Indeed, we apprehend that in a very largo majority of cases where the arbitration agreement is a part of the main contract itself, challenge to the existence or validity of one would mean a challenge to the existence or validity of the other. We would accordingly hold, though for different reasons, that the High Court was right in coming to the conclusion that the petition made by the respondent was competent under section 32 of the Act and has been properly entertained by the trial Court. 782 This question has been the subject matter of some judicial decisions to which reference may now be made. In Messrs. M. Grulamali Abdulhussain & Co. vs Messrs. Vishwambharlal Ruiya(1) a petition had been filed for a declaration that the respondents had entered into the contract with the petitioners for purchase of 500 bars of silver on or about January 30, 1948 according to the rules and regulations of the Marwari Chamber of Commerce, Ltd., and that the respondents were bound to have all disputes in connection with the same contract decided by the arbitrators as provided by the said rules and regulations. The competence of this petition and the jurisdiction of the Court to enter tain it were disputed. Both the learned trial judge and the Court of Appeal rejected the respondents ' contention and held that there was an inherent jurisdiction in the Court to entertain petitions in respect of matters covered by the bar raised by 32. On the other hand, in Bajranglal Laduram vs Agarwal Brothers(2) as well as in State of Bombay vs Adamjee Hajee Dawood & Co., a contrary view has been accepted. In the latter case, a suit had been filed on the Original Side of the Calcutta High Court claiming a declaration that a certain contract was not made between the parties and was not binding on the plaintiff. A further claim was also made that it should be declared that the defendant was not entitled to make any claim in respect of the said contract and that the contract be adjudged void and delivered up as cancelled. The learned trial judge construed the plaint as one for declaration that the arbitration agreement contained in the contract was invalid and on that view he held that under sections 32 and 33 of the Act the suit was not maintainable. On appeal it was held that the suit was not one for challenging the validity of the arbitration agreement merely; it (1) 1. L. R. (2) A. I. R. (3) 1. L. R. 783 covered other reliefs and so bar of sections 32 and 33 could not be pleaded. We are inclined to think that the decision of the Bombay High Court is substantially correct. That takes us to the next question as to whether there was a concluded contract between the parties or not. We have already noticed that in response to the advertisement published by the respondent in the Indian Trade Journal the appellant submitted its tender. It is common ground that the tender thus submitted was subject to the conditions of contract governing the Department of Supply Contracts which were set out in the Government Publication Form W. section B. 133. Clauses 4(a) and (b) of these conditions are relevant. They deal with the security deposit. Clause 4(a) provides that on acceptance of the tender the contractor shall at the option of the Secretary, Department of Supply and within the period specified by him deposit with him a security deposit therein specified. Clause 4 (b) provides that "if the contractor is called upon by the purchaser to deposit security and the contractor fails to provide the security within the period, such failure will constitute a breach of the contractor and the Secretary, Department of Supply, shall be entitled to make other arrangements at the risk and acceptance of the contractor". It is thus obvious that, the tender offered by the appellant submitted to these terms and that on these terms security deposit is a condition subsequent and not a condition precedent. Clause 4(b) makes it clear that the failure to make the deposit would be a breach of the contract itself. This position is not disputed; but Mr. Din Dayal contends that this position has been substantially varied by the Form in which the appellant 's tender was accepted by the respondent. His argument is that the material words used in the acceptance letter changed the preexisting position and made the security deposit a condition. precedent to the acceptance itself. If this contention is right it would necessarily mean 784 that there was no concluded contract. Thus the decision of this point depends upon the construction of the letter of acceptance issued by the respondent to the appellant after receiving its tender. In this letter written on August 31, 1949 the respondent stated as follows: "Dear Sirs, Ref : Your tender No. and date Nil. Your offer is hereby accepted for a quantity of 1704 Cwts. and 2 qrs. (One thousand seven hundred and four hundred weights and two quarters only) of Oil Cocoanut conforming to specification No. IM. 1370 (d) at Rs. 89/6/ (Rupees eighty nine and annas six only) per Cwt. packed in non returnable sound, strong 45 gallon drums, delivery ex godown at Calcutta, by 30 9 49 or earlier if possible subject to your depositing 10% as security. The security money which comes to Rs. 15,230/ (Rupees fifteen thousand two hundred and thirty only) should please be deposited immediately into a Government Treasury in favour of the Deputy Accountant General, I and section, Akbar Road, New Delhi and the Treasury Receipt forwarded to this office. This security money will be refunded to you after the completion of the contract. The contract is concluded by this acceptance and formal acceptance of Tender will follow immediately on receipt of Treasury Receipt. Kindly acknowledge receipt. Yours etc. " The whole argument is founded on the use of the clause " 'Subject to your depositing. 10% as security. " Prima facie this clause may justify the argument that it is intended to make the security deposit a condition precedent; but in construing the true 785 effect of this clause we must look at the whole of the letter bearing in mind the fact that it has been written not by a lawyer or in consultation with a lawyer but by a Government officer in the ordinary course of the discharge of his duties. The first sentence in the first paragraph clearly shows that the offer was accepted for the quantity therein specified. The second paragraph calls upon the appellant to see that the specified amount is deposited immediately into the Government Treassury. This paragraph is more consistent with clause 4(a) of the general conditions. It reads as if having accepted the tender the appellant is reminded that it has to deposit the amount under the relevant condition, and the letter ends with the categorical statement that the contract is concluded by this acceptance. Mr. Din Dayal is right when he contends that section 7 of the Contract Act requires that the acceptance of the offer must be absolute and unqualified, it cannot be conditional; but reading the letter as a whole we do not think that the Courts below have erred in Coming to the conclusion that this letter amounts to an absolute and unqualified acceptance of the tender or offer made by the appellant. While dealing with this question it may be pertinent to recall that the general conditions of the contract prescribed by Form W.S.B. 133 are made a part of the tender, and the contract itself was intended to be executed expeditiously. The tender shows that the appellant represented that the earliest date by which delivery could be effected would be within twenty days from the date of the receipt of the order and it also said that full quantity of cocoanut oil required was held by it. Therefore, to begin with the tender treated the security deposit as a subsequent condition, the contract was for the immediate supply of goods and the acceptance purports to be in accordance with the relevant government rules and uses the expression that the contract was concluded by the said acceptance. Therefore, in our opinion, reading the letter as a whole it would not be possible to 786 accept the appellant 's argument that the letter was intended to make a substantial variation in the contract by making the deposit of security a condition precedent instead of a condition subsequent. In the result the appeal fails and is dismissed with costs. Appeal dismissed.

The appellant and the, respondent nominated their arbitrator who heard the matter at length and the proceedings had reached a stage when an award might have been pronounced. It was then that the appellant chose to obstruct the further progress of the proceedings by raising the plea that there was no, concluded contract. The appellant refused to apply under section 33 and so a stalemate issued because the arbi trators were, not entitled to proceed further, with the arbitration proceedings. , The respondent moved the court under section 28 along with section 33, for a decision of the question about the existence and validity of the. arbitration agreement and also prayed that extension of time be granted to ' the arbitrators for. making the award. The appellant pleaded in defence that ' there was no concluded contract, and there was no jurisdiction in the court to, grant extension under section 28 of the Act. The High Court confirmed the finding of the trial court that there was a concluded contract which contained a valid arbitration agreement. As for jurisdiction it held that since the petition had been filed as composit application under sections 28 and 33, it was open to the court under section 28 to enter upon the question of the existence or validity of the contract and so there was no substance in the point of jurisdiction raised by the appellant. It is against this decision that the appellant came up by special leave. Section 33 of the Arbitration, Act, :1940 consists of two parts the first part deals with a challenge to the existence or validity. of an arbitration agreement or an award and it provides that only persons who challenge the existence of the arbitration agreement that; can. apply under the first part of the section. The second. part of the section refers to the application made to have the effect of either the arbitra 770 an application can be made to have the effect or purport of the agreement determined but not its existence. That means that an application to have the effect of the agreement can be made provided the existence of the agreement is not disputed. The question is whether a person affirming an arbitration agreement can apply under the latter part of section 33 about the existence of the agreement or its validity. Held, that a party affirming the existence of an arbitration agreement cannot apply under section 33 for obtaining a decision that the agreement in question exists. An application to have the effect of the arbitration agreement determined can however, legitimately cover the dispute as to the existence of the said arbitration agreement. Section 32 of the Act creates a bar against the institution of suits with regard to an arbitration agreement or award on any ground whatsoever. Thus if a party affirms the existence of an arbitration agreement or its validity it is not open to the party to file a suit for the purpose of obtaining a declaration about the existence of the said agreement or its validity. The bar to the suit thus created by section 32. inevitably raises the question as to what remedy is open to a party to adopt in order to obtain a appropriate declaration about the existence or validity of an arbitration agreement. Held, that having regard to the scheme of sections 31, 32, 33 of the Act in matters which fall within the bar created by section 32, if a suit cannot be filed it is necessarily intended that an application can be made under the court 's powers provided for by section 31 and impliedly recognised by section 32 of the Act. Held, further that in holding that section 32 impliedly recogniscs the inherent jurisdiction of the court to entertain an application made by parties affirming the existence of an arbitration agreement the provisions of section 32 is brought it line with the provisions of sections 33 and 20 of the Act. Indeed section 33 is a corollary of section 32 and in a sense deals with the most usual type of cases arising in arbitration proceedings. A question arises whether an application ran be made under such inherent jurisdiction for declaration that the contract which includes the arbitration agreement includes cases where the arbitration agreement is made a part of the contract itself. Held, that where the challenge to the contract made in defence to the claim, is a challenge common to both the contract and the arbitration agreement, the petition in substance is a petition for a declaration as to the existence of a valid arbitration agreement and a suit to obtain such a declaration is clearly barred by section 32. The fact that an incidental declaration is claimed about the existence and validity of the main contract does not affect the essential 771 character of the application. It is an application for obtaining a declaration about the existence and validity of an arbitration agreement. Held, also that the powers to enlarge time for making the award which is the subject matter of section 28 does not include a power to entertain a petition for declaration that there was a concluded contract between the parties containing a valid arbitration agreement. Hayman vs Darwins. Ltd., , referred to. Messrs. M. Gulamali Abdulhussain & Co. vs Messrs. Vishwambharlal Buiya, I.L.R. , approved. Bajranglal Laduram vs Agarwal Brothers, A.I.R. 1950 Cal. 267 and State of Bombay vs Adamjeee Hajee Dawood & Co. Ltd. I.L.R. (1 952) , disapproved.

Appeal No. 13 of 1952. Appeal from the Judgment and Order dated 18th January, 1950, of the High Court of Judicature at Madras (Satyanarayana Rao and Viswanaths Sastri JJ.) in Case Referred No. 28 of 1947. O. T. G. Nambiar (section N. Mukherjee, with him) for the appellant. M. C. Setalvad, Attorney General of India, and C.K. Daphtary, Solicitor General for India (G. N. Joshi and P. A. Mehta, with them) for the respondent. December 22. The Judgment of the Court was delivered by BOSE J. The following question was referred to the High Court of Madras by the Income tax Appellate Tribunal under section 66 (1) of the Indian Income tax Act, 1922 Whether on the facts and in the circumstances of the case when an assessment has been made under section 23 (1) of the Indian Income tax Act, determining the assessee company 's income as 'nil ' and when proceedings under section 34 were subsequently started to assess the income which the 450 Income tax Officer believed to have escaped assessment the assessee company is entitled to claim that the loss of profits and gains (including depreciation allowance) sustained by it in the previous year should be determined in the course of such proceedings. " We are concerned in this case with the assessment year 1941 42. The assessee is the Anglo French Textile Company, a company which is incorporated in the United Kingdom. It owns spinning and weaving mills at Pondicherry in French India and manufactures yarn and cloth there. The raw materials necessary for the manufacture, or at any rate much of it, such as cotton, used to be purchased in what was then the British India, through its agents Best & Company Ltd. of Madras. The bulk of its manufactured goods 'was ' also sold in British India, the rest being sold elsewhere. But in the year material to this case it did no business in British India and accordingly it submitted no return to the Income tax authorities. On 26th April, 1941, the Income tax Officer issued a notice to the assessee and called for a return. The assessee replied on 9th June, 1941, that it had ",at all times material to the assessment year no business in British India " and consequently no profits arose or accrued or were received in British India and therefore the assessee "was not liable to comply with the provisions of the Indian. Income tax Act. " The assessee added. In the Circumstances the company is not liable to make a return but with a view to preserve the right of the company to appeal against any order that may be passed by you, if necessary, we submit herewith without prejudice a nil return receipt of which kindly acknowledge. " Appended to the letter was a piece of paper which has been called a " nil" return. It is the usual printed form in which returns are, normally made but the only entry.in the whole form is the word " nil The following declaration was also added: 451 "I further declare that the company was not resident in British India during the previous year etc. " On 25th March, 1942, the Income tax Officer made the following order which he called an Assessment Order: "The company made a nil return of income obviously for the reason that it is not carrying on any business in British India . I accept the return of income filed by the company and declare it is not liable to tax for the year 1941 42. " A year later, namely, on 9th March, 1943, the Income tax Officer sent the assessee a notice under section 34 (1) (b) in the following terms: Whereas in consequence of the definite information which has come into my possession I have discovered that your income assessable to income tax for the year ending 31st March, 1942 has (a) escaped assessment. I therefore propose to assess the said income that has (a) escaped assessment. I hereby require you to deliver to me not later than . a return in the attached form of your total income and total world income assessable for the said year. " In reply to this the assessee again submitted the same CC nil " return and filed a statement showing a loss of Rs. 3,92,357 on its total world income. This was on 31st May, 1944. The Income tax Officer passed orders on this on 2nd June, 1944. He stated that the assessee was a non resident company and that during the year no sales were effected in British India and concluded as follows: As the net result for the world business is only a loss, there can be no question of profits attributable 452 co operations in British India under section 42 (1) and 42 (3) in respect of cotton purchases. The nil ' return filed is therefore accepted, Hence there is no assessment for 1941 42. As this is a non resident company, the loss need not be carried forward under section 24 (2) as that section in terms does not apply to non residents. " The last portion of the order is the one which occasions the assessee 'B grievance. It claims that the Income tax Officer having accepted its statement of loss was bound to record it and carry it forward. Appeals followed to the Appellate Assistant Commissioner of Income tax and the Income tax Appellate Tribunal and ultimately there was a reference to the High Court. The assessee has failed throughout.and now appeals here. The assessee 's contention is based on the following provision of section 34. The first sub section states that when a notice is issued under that section the Income tax Officer may proceed to assess or re assess such income, profits or gains or recompute the loss or depreciation allowance and that " the provisions of this Act shall, so far as may be, apply, accordingly as if the notice were a notice issued under [sub section (2) of section 22]. " This it is said attracts section 24 (2). We need not decide whether this contention is well founded, namely, whether the assessee can claim to reopen the proceedings, because, even if he can, we are of opinion that he cannot get what he asks for. There is no provision in the Act which entitles the assesses to have a loss recorded or computed, unless something is to be done with the loss. Thus, under section 24 (1) a loss can be set off against an income, profit or gain and under sub section (2) the balance of a loss can be carried forward to a following year on the conditions set out there. Except for this there is nothing else that can be called in aid. But under ' sub section (2) the loss can be carried forward when 453 "the loss cannot be wholly set. off under subsection (1) and in that event only the "portion not so set off " can be carried forward. We are therefore. thrown back o sub section (1). Sub section (1) provides that where an 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 loss " set off against his income, profits or gains under any other head in that year." Therefore, before any question of set off can arise, there must be (1) a loss under one or more of the heads mentioned in section 6, and (2) an income, profit or gain under some other head. It follows that when there is no income under any head at all, there is nothing against which the loss can be set off in that year and unless that can be done sub section (2) does not come into play. Next, a set off Under section 24 (1) can only be claimed when the loss arises under one head and the profit against which it is sought to be set off arises under a different head. When the two arise under the same head, of course the loss can be deducted but that is done under section 10 and not under section 24 (1). See the decision of the Privy Council in Rm. Arunachalam Chettiar vs Commissioner of Income tax, Madras (1). In the present case, the loss is computed by striking a balance in the profit and loss account of just the one business and con sequently no question of different heads arises. On both these grounds, therefore, the assessee 's contention must fail because, unless the loss can be set off under sub section (1) of section 24, it cannot be carried forward under sub section (2) and if it cannot be carried forward the question of its determination and computation becomes irrelevant. The High Court proceeds on the ground that when proceedings are taken under section 34 the assesses (1) at 178 and 179. 454 is not entitled to reopen the whole proceedings as the further proceedings are limited to assessing that portion of the income which has escaped assessment. We need not express any opinion on this. The question we have to answer is confined to the facts and circumstances of this case and those circumstances are (1) that no return was filed at any stage of the case disclosing any income, profits or gains at all, (2) that proceedings were later taken under section 34, and (3) in the course of these proceedings the assessee claimed that a certain loss should be determined and recorded. Our answer is that cannot be done for the reasons we have given and that consequently the question referred was rightly answered in the negative by the High Court. The appeal fails and is dismissed with costs. Appeal dismissed.

An assessee submitted a return showing the income as "nil" and this return was accepted by the Income tax Officer, In the 449 next year the Income tax Officer sent a notice to the assessee under section 34 (1) (b) calling for a fresh return,. , The assesses submitted a return showing the income as nil " and a loss of Rs. 3,92,357 and claimed that the loss should be recorded and carried forward under section 24 (2) of the Income tax Act. The loss was arrived at by striking a balance in the profit and loss account of just one business: Held, that the assessee was not entitled to 'have the loss determined and carried forward for two reasons, first, because when there is no income under any head at all there is nothing against which the loss can be set off in that year under section 24 (1) and unless that can be done sub section (2) of section 24 does not come into play ; secondly, a set off under section 24 (2) can only be claimed when the loss arises under one head and the profit against which it is sought to be set off under a different head. Quaere: Whether when proceedings are taken under section 34 for the assessment of income which has escaped assessment, the assesses is entitled to re open the whole proceedings.

the matter of Mr. 'A ' an Advocate. The Advocate in person. H. N. Sanyal, Additional Solicitor General of India and T. M. Sen, for the Attorney General of India. September 25 and November 2. The Judgment of the Court was delivered by SINHA, C. J. The Advocate proceeded against for professional misconduct was enrolled as an advocate of the Allahabad High Court in December 1958. In January 1961, he was enrolled as an advocate of this Court. The proceedings against him were taken in accordance with the procedure laid down in O. IV A of the Supreme Court Rules. In March this year the Registrar of this Court received a letter, marked 'Secret ', from Secretary to the Government of Maharashtra, in the Department of law & Judiciary, to the effect that the "Advocate on Record" of the Supreme Court had addressed a post card, dated January 1, 1961, to the Minister of Law of the State of Maharashtra, which "constitutes a gross case of advertisement and solicitation for work. " The original post card was enclosed with the letter, with the request that the matter may be placed before the Chief Justice and the other Judges of the Supreme Court for such action as to their Lordships may seem fit and proper. The post card, which was marked as exhibit A in the proceedings which followed, is in these terms: Mr. 'A '. Advocate on Record. Supreme Court, Office and Residence B.9, Model Town, Delhi 9. Dated 19 1 61. 290 Dear Sir, Jai Hind. Your attention is drawn to the rule 20 of order IV of the Supreme Court Rules 1950 (as amended upto date) to appoint an Advocate on Record in the Supreme Court as according to this rule 'no advocate other than an advocate on Record shall appear and plead in any matter unless he is instructed by an Advocate on Record. ' You might have got an Advocate on Record in this court but I would like to place my services at your disposal if you so wish and agree. Hoping to be favoured. Thanks, Yours sincerely, Sd: 'A ' To The Minister of Law, Government of Maharashtra, Bombay. " When the matter was placed before the Chief Justice, he directed the Registrar informally to enquire from the Advocate concerned whether the post card in question had been written by him and bore his rubber stamp and signature. The Registrar called him, and in answer to his queries, the Advocate admitted that the post card bore his rubber stamp and signature and that it bad in fact been dispatched by him. He also informed the Registrar that he had addressed similar post cards to other parties. The Advocate added that he did not realise that in addressing those post cards he was committing any wrong or breach of etiquette. The Chief Justice, on receiving the aforesaid information, placed the matter before a Committee of three Judges of this Court, under r. 2, O. IV A. The Committee considered the matter referred to it, and 291 on receiving its opinion, the Chief Justice constituted a Tribunal of three members of the Bar, Shri Bishan Narain and Shri A. Ranganadham Chetty, Senior Advocates, and Shri I. N. Shroff, Advocate, with Shri Bishan Narain as its President, for holding the necessary enquiry into the alleged conduct of the Advocate proceeded against. In reply to the notice served on the Advocate, he chose to behave in a most irresponsible way by alleging that the complaint in question by the Government of Maharashtra "is false, mala fide and misconceived". He denied that he had written the letter in question, which he characterised as "the work of any miscreant". He added further that even if it were proved that the letter in question had been written by him, a mere perusal of it would show that there was nothing unprofessional or otherwise objectionable in it, and he added further that certainly it is not solicitation of work if one inquires from any person whether it requires or wishes and agrees to have the services of another advocate". The Advocate was examined as witness on his own behalf and the Tribunal put the post card to him. The following questions by the Tribunal and answers by the Advocate will show the determined way in which he denied what he had admitted to the Registrar. "Tribunal: This post card which has been brought to the notice of the court purports to be from you. Is this the post card which you have written ? Witness: No. Tribunal: Has it not gone from your office ? Witness: No. There is no doubt it bears the seal of my office, but it has not been affixed by me. 292 Tribunal: You say it does bear your name and that the rubber stamp which appears is of your office but that it has not been affixed by you. Witness: Yes. Tribunal: Is the hand writing which one find on this Postcard your hand writing ? Witness: No. Tribunal: And the signature which is at the foot of the letter, you say, is not your signature. Witness: No, it is not mine" The Tribunal pursued the matter further to find out as to how the post card had purported to emanate from his office, and then certain documents, marked Exs. B to E, were brought on the record with a view to comparing his admitted hand writing in those documents with that of the post card in question. The Tribunal also made him write a letter in the very terms in which the postcard is written, with a view to making a comparison of the handwriting on the post card with his admitted writing in identical terms, given by him in Court. The Tribunal then confronted him with his admissions made to the Registrar, as aforesaid, before the proceedings started. The following questions and answers will further indicate his attitude; "Tribunal: In what respects do you find any difference between your normal signature and this signature (signature on the post card is shown to him). Witness: It appears to be like my signature, but it is not my signature. Signature on exhibit A is not my signature. 293 Tribunal: In connection with this post card did you see the Registrar (Supreme Court) ? Witness: Yes, he called me. Tribunal: When? Do you know the date ? Witness: I do not remember. Tribunal: Did you say anything to him ? Witness: I did not make any statement. He showed me the post card. I told him, as I said here, that I held not written it; somebody else might have written it. Tribunal: Did you admit before the Registrar that this letter was written by you ? Witness: I did not admit it, but he told me that if I admitted it, the matter might be hushed up. Tribunal: Did you say to the Registrar that you did not realise that in so doing you were doing any thing wrong ? Witness: No. I did not say anything. Tribunal: Do you want to produce any evidence ? Witness: No, because I have not done anything; so, I do not want to produce any evidence. Even if it is found that I have written the post card, even then on merits, there is nothing in this Case". Finding that the Advocate was adamant in his denial that he wrote the post card or that he had made any statement before the Registrar, the Tribunal called the Registrar as a witness and examined him on solemn affirmation. The Registrar are his evidence and fully supported his previous 294 report that the Advocate had made those admissions before him. After recording the evidence, oral and documentary, the tribunal made the report that inspite of stout denial by the Advocate concerned, the Tribunal was satisfied that the post card in question had been written by him. The Tribunal was also of opinion that the Advocate did not realise that in writing the post card he was committing a breach of professional etiquette and of professional ethics. It also remarked that it was unfortunate that the Advocate chose to deny the authorship of the post card. The findings of the Tribunal, along with the evidence and record of the case, have been placed before us. 'the Advocate, on notice, has appeared before us and we have heard him. Before us also the Advocate first took up the same attitude as he had adopted before the Tribunal, but on being pressed by the Court to make a true statement as to whether he had written the post card and had admitted before the Registrar that he had done so, he answered in the affirmative. It is clear beyond any shadow of doubt that the Advocate had addressed the letter aforesaid to the Government of Maharashtra, soliciting their briefs; that he had admitted to the Registrar of` this Court that he had written the post card and other such post cards to other parties, and that he did so in utter disregard of his position as an Advocate of this Court. It is equally clear that his denial of having written the post card, and of having subsequently admitted it to the Registrar, was again in utter disregard of truth. He has, in this Court, condemned himself as a liar and as one who is either ignorant of the elementary rules of professional ethics or has no regard for them. In our opinion, the Advocate has mischosen his profession. Apparently he is a man of very weak moral fibre. If he is ignorant of the elementary 295 rules of professional. ethics, he has demonstrated the inadequacy of his training and education befitting a member of the profession of law. If he M knew that it was highly improper to solicit a brief and even then wrote the post card in question, he is a very unworthy member of the learned profession. In any view of the matter, he does not appear to be possessed of a high moral calibre, which is essential for a member of the legal profession. If anything, by adopting the attitude of denial which has been demonstrated to he false in the course of the proceedings before the Tribunal, he has not deserved well of the Court even in the matter of amount of punishment to be meted to him for his proved misconduct. In our opinion, he fully deserves the punishment of suspension from practice for five years. This punishment will give him enough time and opportunity for deciding for himself, after deep deliberation and introspection, whether he is fit to continue to be a member of the legal profession. In our view he is not. Let him learn that a lawyer must never be a liar.

Mr. A, an Advocate on Record of this Court, wrote letters soliciting clients. One of such letters, a post card was addressed to the Law Minister of Maharashtra and ended as follows, "You might have got an Advocate on Record in this Court but I would like to place my services at your disposal is you so wish and agree". To the Registrar of this Court he admitted having written the post card, but before the Tribunal stoutly denied having done so. The Tribunal found on evidence that the Advocate had written the post card. When the matter came up before the court, the Advocate at first denied having written the post card but on being pressed by the court to make a true statement admitted that he had written the postcard and had admitted that before the Registrar. ^ Held, that it is against the etiquette of the Bar and its professional ethics to solicit briefs from clients and an Advocate who does so must be guilty of grossly unprofessional conduct. There can be no doubt in the instant case that the Advocate concerned had written the post card soliciting briefs. It makes no difference whether he did so in ignorance of this elementary rule of the profession or in disregard of it, since his conduct in court showed that he had no regard for truth and, consequently, he deserved no sympathy of the court and must be suspended.

Appeal No. 354 of 1957. Appeal from the judgment and decree dated October 7, 1955, of the Patna High Court in Misc. Judicial Case No. 422 of 1954. L. K. Jha, D. P. Singh., R. K. Garg, M. K. Ramamurthi and section C. Agarwala, for the appellants. B. K. P. Sinha and A. G. Ratnaparkhi, for respondent. September 22. The Judgment of the Court was delivered by DAS GUPTA, J. This appeal by the State of Bihar challenges the correctness of an order made by the High Court at Patna in an application by the respondent under article 226 of the constitution. The respondent was inducted as a tenant oil a tract of land measuring 245.69 acres in village Singpur by the then proprietor in November 1945, and continued to remain in possession after the Zemindari interest of the proprietor became vested in the State of Bihar in consequence of a notification under the Bihar Land Reforms Act (Bihar Act XXX of 1952) on the 30th December, 1952. In 1945 this area was forest land. On September 15, 1946, a notification was published under section 14 of the Bihar Private Forest Act, 1946 declaring the Government 's intention of constituting the forest a private protected forest. By the same notification the Governor further ordered that until the publication of a notification under a. 30 of the Act all the rights to out, collect and remove trees or any class of trees in or from the forest shall cease to exist subject to conditions and specifications specified in the Second Schedule. The result of this notification was that immediately on its publication in the Government Gazette the respondent 's right to cut, collect and remove trees 729 ceased so long as this forest continued to be a private forest. On the 6th April, 1948, a notification under the proviso to section 30 of the Bihar Private Forest Act, was published. After the forest land became vested in the State on the 30th December, 1952, there was a notification on January 22, 1953, which both parties agree, was in substance under the proviso to section 29 of the . It is the common case of both the parties that in consequence of this notification the forests in Singpur Village became a protected forest. On May 29, 1953, a further notification under section 30 of, the was made prohibiting the breaking up or clearing the ,land of this and certain other "protected forests" for cultivation. As local employees of the Forest Department acting under the Divisional Forest Officer, Gaya, started interfering with the agricultural operations carried on behalf of the petitioner apparently on the strength of this notification of May 29, 1953, the respondent sought the per mission of the Collector of Gaya to start reclamation and cultivation of lands. On April 22, 1954 the Collector of Gaya gave the petitioner permission "to go ahead with the work of reclamation and cultivation in this area. " The Forest Officer however disregarded the Collector '& orders and made the petitioner to stop: reclamation. On being approached by the appellant the Collector called upon the Forest Officer to furnish an explanation as to why he had flouted deliberately the Collector 's orders. Ultimately, the Bihar Government sent a telegram to the Collector, Gaya, on June 10, 1954 desiring that the order issued by the Collector on April 22, permitting the respondent "to go ahead with the reclamation should be withdrawn pending the decision of the Government in the matter". The Collector forwarded a copy of this telegram to the respondent for information and necessary action on June 11, 1954. 730 It does not appear that any further order has been made by Government in the matter. On August 2, 1954 the respondent made his application to the High Court of Judicature at Patna praying that an appropriate writ be issued for cancellation by the Government of Bihar of the directions given on June 10, 1954 to the Collector and for restraining the Government of Bihar and the Forest Officer from interfering with the petitioner 's possession over this land in village Singpur. The petitioner 's case was that the forest having become a protected forest under Chapter IV of the the Collector was the proper and competent authority to give permission to clear or break up for cultivation, land in this forest under Rule 8 of the rules made by the Government of Bihar in exercise of the power conferred by section 32 of the and that neither the Forest Officer nor the Government of Bihar itself could in law interfere with what he was doing on the strength of that permission. In opposing the petition the State of Bihar contended that the Collector 's order was of no avail in the face of rule 4 of the rules made by the Government of Bihar under section 32 which provides that " 'no person shall out, convert, or remove from the said forest or otherwise deal in trees etc., of the forest" except in accordance with Rules I, II and III. At the hearing of the petition it was further argued on behalf on the State that the right of the petitioner to the land in dispute had been extinguished under section 19 of the Bihar Act IX of 1948, on the publication of a notification by the Government of Bihar under the proviso to section 30 of that Act. The High Court rejected this argu ment, being of the opinion that extinction could take place only when the final notification under section 30 was published and as this final notification was not published section 19 had no application 731 to the case. The High Court also held that in a case where a Collector grants permission under Rule 8 of the 1 Bihar Protected Forest Rules the Divisional Forest Officer had no power to interfere by virtue of Rules 1,to 4 of the same Rules. Accordingly the High Court allowed the petition and made an order quashing the State Government 's order conveyed in their telegram of the 10th June and the order of the Forest Officer dated the let May, by which this Officer had prohibited reclamation of the disputed land by the petitioner. In this Court, Mr. Jha raised both the points on which the petition was resisted before the High Court, viz., (1) that the petitioner 's right to the land had ceased under section 19 of the Bihar Private Forests Act and (2) that, the order passed by the Forest Officer on the basis: of Rule 4 of the Bihar Protected Forests Rules should prevail over the permission granted by the Collector under r. 8. Mr. Jha 's first contention on the first point was that when a notification is made under the proviso to section 30, no further notification under section 30 need be made at all. In our opinion, there is no force in this contention. The provisions of the Bihar Private Forests Act, 1947 in respect of private Protected Forests are contained in Chapter II of the Act. The scheme of these provisions is that the State Government on being satisfied that it is necessary in the public interest to apply the ' provisions of the chapter to any private forest, may constitute such forest a protected. forest in the manner laid down; the first step that has to be taken is the issue of a notification under section 14 declaring that it is proposed to constitute a forest a private protected forest and calling for objections ' of all landlords whose interests are 'likely to be, affected. The hearing of objections is provided for in section 15, sub section 3 of which section further provides that if no objection is presented or when objection is so ' presented and 732 finally disposed of the Government may issue a notification declaring its decision to constitute the area a private forest and appointing an officer "to enquire into and determine the existence, nature and extent of any rights other than landlord 's rights, alleged to exist in favour of any person in or over any land in the forest". Section 16 provides that on the issue of such a notification under sub section 3 of s.15 the Forest Settlement Officer shall publish a proclamation fixing a period of not less than three months from the date of such proclamation for claims to be made by all persons as regards rights other than landlord 's rights. Section 17 empowers the Forest Settlement Officer to enquire into all claims preferred in response to the notification and also into the existence of any rights mentioned in sub s.3 of section 15 and not claimed under a. 16. Section 22 of this Chapter deals with the procedures for dealing with claims of forest contractors and grantees. Section 23 provides that in the case of claim to a right in or over any land other than a right of way or right of pasture or a right to forest produce or water course the Forest Settlement Officer shall pass an order admitting or rejecting the same in whole or in part subject to the provisions of sections 25 and 26. Section 27 gives a right of appeal to any person who has made a claim under section 16 or section 22 against the order passed by the Forest Settlement Officer under as. 22, 23, 24 or 26. Section 30 provides for the final action to be taken by the Government in the matter of constituting a private protected forest. The main portion of the section is in these words: "Where the following events have occurred, namely, (a) the period fixed under section 16 for preferring claims has elapsed and all claims, if any, made under sections 16 and 22 have been disposed of by the forest settlement officer, and 733 (b) if any such claim has been made, the period limited by section 27 for appealing from the orders passed on such claims has elapsed, and all appeals (if any) presented within such period have been disposed of by the appellate officer, the State Government shall publish a notification in the Official Gazette specifying. definitely according to boundary marks erected or otherwise,. the limits of the forest which is to be constituted a private protected forest, and declaring the same to be a private protected forest, from the date fixed by the notification and from the date so fixed such forest shall be deemed to be a private protected forest". It is followed by a proviso in the following words: "Provided that, if in the case of any forest in respect of which a notification under section 14 has issued, the State Government consider that the inquiries, procedure and appeals referred to in this Chapter will occupy such length of time as to cause undue delay in the forest being declared a private protected forest, such delay, in the opinion of the State Government being prejudicial to the public interest, the State Government may, pending the completion of the said enquiries, procedure and appeals, declare by a notifica tion containing the particulars specified in this section, such forest to be a private forest". It is abundantly clear that the notification under the proviso is not intended to amount to a final constitution of the private forest as a private protected forest. The notification under the proviso is to be made only ,pending the completion of the said enquiries procedure and appeals". Quite clearly, these enquiries, procedure and appeals are not stopped the declaration under the proviso. They have to 734 be completed and it is only after their completion that a notification ban be made by the Government under the main part of the section. , On a reasonable reading of the section it is therefore abundantly clear that even where the: Government thinks fit to make a declaration under the proviso, this will have effect only so long as the period fixed under section 16 for preferring, claims (i) has not expired;, (ii) claims under ss.16 and 22 have not, been disposed of, (iii) the periods limited by section 27 for appealing from the orders passed in respect of those claims have not elapsed; and (iv) all appeals preferred against such orders have been disposed of. Turning now to section 19 of this Chapter we find it laying down that "rights (other than landlord 's rights) in respect of which no claim has been preferred under section 16 and of the existence of which no knowledge has been acquired by enquiry under section 17, shall be extinguished, unless before the noti fication under section 30 is published, the person claiming them satisfies the Forest Settlement Officer that he had sufficient cause for not preferring such claim within the period fixed under section 16. " The appellant 's argument is that the words "notification under section 30 is published" includes a notification made under the proviso to that section and that consequently when a notification under the proviso to section 30 has been published all rights other than landlords rights, in respect of which no claim has been preferred and of the existence of which no knowledge has been acquired by an enquiry under section 17, shall be extinguished. This argument is in our opinion wholly unacceptable. Considered in the background of the provisions in the Act for claims to be made under section 16, for enquiry into these by the Forest Officer and thereafter for appeals from the decision of the Forest Officer, after the completion of all of which only 'the final notification constituting the private forest a private protected 'forest can be 735 made, it is clear that rights "other than landlord 's rights" in respect of which no claim has been preferred under a. 16 or which have not been disclosed by enquiry under section 17 were intended by the legislature to be extinguished only after the final notification is made. It is to be noticed that three months ' time from the date of the proclamation under section 16 is to be allowed for making claims. The enquiry under section 17 can start only after these claims have been made and some more time must elapse before an enquiry can be completed into the existence of rights which have not been claimed under section 16. A notification under the proviso of section 30 can however be made at any time after the notification under section 14 has issued. It is meaningless to speak of rights in respect of which no claim has been preferred under s.16 and of the existence of which no knowledge has been acquired by an enquiry under section 17, before the period for the enquiry under section 17 has expired. Again, there will be no extinction of rights. under section 19, if the person claiming the rights, satisfies the Forest Settlement Officer that he hid sufficient cause for not preferring the claim within the period fixed under section 16. The question of thus satisfying the Forest Settlement Officer can clearly not arise before the period fixed under section 16 has expired. All this clearly shows that the extinction of rights under section 19 can take place only after the final notification under section 30 has been published. It is necessary to consider next the apparent conflict between the powers of the Officers of the Forest Department under rr. 1 to 4 and the powers of the Collector under r. 8 of the Protected Forest Rules. Under r. 1 persons who are bona fide residents of Khasmahal lands may cut, convert and remove to their homes for their own domestic use certain trees but the Forest Officer can in his discretion withdraw this privilege Certain other trees as specified in the Rule may 736 be out by such bona fide residents with the previous permission of the Forest Officer. Under r. 2 the Forest Officer may by an order in writing authorise in certain circumstances villagers of adjacent villages also to cut and remove trees mentioned in r. 1. Rule 3 provides that the Divisional Forest Officer may grant license to any inhabitant of a town or village in the vicinity of a forest to take trees, timber, or other produce for his own use to any person whatsoever authorising him to fell or remove trees for the purpose of trade on payment of fees at current rates as may be sanctioned by the Chief Conservator of Forests. Rule 4 on which special reliance is placed on behalf of the State is in these words : "No person shall cut, convert or remove from the said forest or otherwise deal with any trees, timber or other forest produce of the said forest. . except as provided in Rules 1, II and III. Rule 8 under which the Collector gave permission runs thus : "No land in the said forest shall be cleared or broken for cultivation or any other purpose without the written permission of the Collector". There is an apparent conflict here between the provisions of r. 4 and r. 8 ; for, while under r. 4 no cutting, conversion or removal of trees can be made except under license issued under r. 3 or permission granted by the Forest Officer under r. 2 or under the provisions of r. 1, all this can be set at naught if a written permission is granted by the Collector for clearing or breaking up the land for cultivation or any other purpose necessarily involving the cutting and removal of trees. On behalf of the appellant State Mr ' Jha argued that r. 8 has no operation so long as trees are standing and it is only if trees have been cut or removed under the provisions of rr. 1, 2 and 3 and only stumps of those trees are standing that the Collector can give permission for clearing the forest land or breaking it up for cultivation. We are unable to persuade ourselves that in making 737 these rules the Government intended to give such limited authority only to the Collector. It is obvious that while Rules 1, 2, 3 and 4 were made under clauses a, b, c and d of section 32, Rule 8 has been made under clause g of section 32 which is for the definite matter of "clearing and breaking up of land for cultivation or any other purpose" in a protected forest. The reasonable way of reading Rules 1 to 4 and Rule 8 appears to us to be that Rules 1 to 4 apply to the cutting or removal of trees where in spite of such cutting the forest would continue to be a forest; but cutting of trees which is necessary for clearing the land for cultivation or any other purpose is not controlled by Rules 1, 2, 3 or 4 but only by Rule 8. That seems to us to be the only way of harmonious construction of Rules 4 and 8 and that must, in our opinion, have been intended by the rule making authority. In the present case therefore when the tenant on the land asked for permission to clear the land for cultivation and it was this clearing which involved the cutting and removal of trees Rules 1 to 4 had no application and Rule 8 under which the Collector acted applied. It may be mentioned here that though Rule 8 is in the negative form, it is what has been called a pregnant negative, saying on the one hand that land in the forest may be cleared or broken for cultivation or any other purpose with the written permission of the Collector and on the other hand that without such permission no such clearing or breaking up for cultivation or any other purpose shall take place. The permission given in the present case by the Collector was therefore in accordance with law and neither the Forest Officer nor the Government had any authority in law to interfere with that permission. The last argument advanced by Mr. Jha is that the prohibition by the State Government of clearing or breaking up for cultivation or for any other purpose of any land in a protected forest by the notification dated May 29, 1953, under section 30 of 738 the India Forest Act, 1927, must prevail over the permission, given by the Collector. It is to be noticed that whereas section 30 empowers the State Government inter alia to prohibit such breaking up or clearing for cultivation of any land in a protected forest, section 32 empowers the State Government to make rules to regulate inter alia "the clearing and breaking of land for cultivation or any other purpose" in a protected forest. Even if the legislature had said nothing else in this matter, it would have been plausible to argue that the prohibition under the notification would yield before any permission given under the Rules under a. 32. All doubts are however set at rest by section 34 of the Act which runs thus : "Nothing in this Chapter shall be deemed to prohibit any act done with the permission in writing of the Forest Officer, or in accordance with rules made under section 32, or except as regards any portion of a forest closed under section 30, or as regards any rights the exercise of which has been suspended under section 33, in the exercise of any right recorded under section 29". It follows clearly and necessarily from section 34 that the prohibition by notification of the clearing of land would be ineffective where such clearing is being made in accordance with Rule 8 of the Rules made under section 32. All the contentions raised in the appeal therefore fail. We are of opinion that there is no legal authority for the State Government to interfere with the clearing or cultivation of land by the respondent which is proposed to be done in accordance with the written permission granted by the Collector under Rule 8 of the Protected Forest Rules, 1953. It appears that through some oversight the High Court ordered the issue of a writ of certiorari, though a writ in the nature of mandamus was 739 prayed for. It is clear that the appropriate writ in the circumstances of the present case is a writ in the nature of mandamus and we modify the order made by the High Court to this extent that a writ in the nature of mandamus be issued directing the appellant Government to cancel its order on the Collector made on June 10, 1954 and restraining the Government and the Forest Officer from inter fearing with the petitioner 's possession over 245.69 acres of land in village Singpur which he possesses as tenant. The appeal is dismissed with costs. Appeal dismissed.

The respondent was the tenant of a tract of land which formed part of a forest and continued to remain in possession thereof after the Zermindari interest of the proprietor became vested in the State Government under the Bihar Land Reforms Act, 1952. The Government notified its intention to constitute the forest a private protected forest and by a subsequent notification under section 30 of the Indian Forest Act prohibited the breaking up or cleaning the land of this and certain other "protected forests" for cultivation whereupon the employees 'of the Forest Department started interfering with the agricultural operations carried on by the respondent. The respondent then sought the permission of the Collector to start reclamation and cultivation of this area and the Collector gave him permission to "go ahead with the work of reclamation and cultivation of this area. " The forest officer disregarded the Collector 's order and made the respondent stop reclamation. Ultimately the Government interfered insisting on the withdrawal of the Collector 's order. The questions which arose for decision in this case was whether (1) the order passed by the Forest officer on the basis of rule of the Bihar Protected Forest Rules,which prohibited the cutting or removal of trees without the permission of the Forest Officer should prevail over the permission granted by the Collector under r. 8 and (2) whether the respondent 's right to the land had ceased under section 19 of the Bihar Private Forests Act. Held, that rr. 1 to 4 apply to the cutting or removal of trees where inspite of such cutting the forest would remain a forest but those rules did not control the cutting of trees which would be necessary for clearing the land for cultivation or any other purpose which was controlled only by r. 8. In the present cast the permission given by the Collector under r. 8 was in accordance with law and neither the Forest Officer nor the Government had any authority in law to interfere with that permission for the clearing or cultivation of the land. The extinction of rights under section 19 of the Act could take place only after the publication of the final notification 728 under section 30 and not by a notification under the proviso thereof pending the completion of enquiries under the provisions of the Act.

Appeals Nos. 408 to 410 of 1960. Appeals from the judgment and order dated September 11, 1958, of the Madras High Court in Writ Petition Nos. 384 of 1957 and 660 of 1958. WITH Criminal Appeals Nos. 38, 126 and 123 of 1959. Appeals by special leave from the judgments orders dated May 16, 1958, June 19, 1959 and April 14, 1959, of the Punjab High Court in Criminal Revisions Nos. 290 of 1958 and 144 of 1959 and Criminal Appeal No. 677 of 1958 respectively. AND Civil Appeal No. 511 of 1960. Appeal from the judgment and order dated March 20, 1959, of the Bombay High Court (Bench) at Nagpur in Special Civil Application No. 322 of 1958. AND Petition No. 118 of 1958. Petition under article 32 of the Constitution of India for ' enforcement of Fundamental Rights. C. K. Daphtary, Solicitor General of India, H. J. Umrigar and P. M. Sen, for the appellant in 790 C. As. Nos. 408 and 409 of 1960 and respondent in C. A. No. 410 of 1960. N. A. Palkhivala, section R. Vakil, R. J. Joshi. section J. Sohrabji, J. B. Dadachanji, section N. Andley, Rameshwar Nath, and P. L. Vohra, for the respondents in C. As. Nos. 408 and 409 of 60 and appellant in C. A. No. 410 of 1 960. R. section Narula, for the appellant in Cr. A. No. 38 of 59. C. K. Daphtary, Solicitor General of India, N. section Bindra and D. Gupta, for the respondent in Cr. A. No. 38 of 1959. T. M. Sen, for Intervener No. 1 in Cr. A. No. 38 of 59. K. N. Keswani, for intervener No. 2 in Cr. A. N o. 38 of 59. R. section Narula and R. L. Kohli, for the appellant in Cr. A. No. 126 of 1959. C. K. Daphtary, Solicitor General of India, H. J. Umrigar and D. Gupta, for the respondent in Cr. A. No. 126 of .1959. N. C. Chatterji, section K. Kapur and Ganpat Rai, for the, appellant in Cr. A. No. 126 of 1959. A. section Bodbe, Shankar Anand and Ganpat Rai, for the appellant in C. A. No. 511 of 1960. C. K. Daphtary, Solicitor General of India, H. J. Umrigar and T. M. Sen, for the respondent in ,C. A. No. 511 of 1960. section Venkatakrishnan, for the petitioner in Petn. No. 118 of 1958. C. K., Daphtray, Solicitor General of India, H. J. Umrigar and R. H. Dhebar, for the respondents in Petn. No. 118 of 1958. September 25. The Judgment of the Court was delivered by AYYANGAR, J. The (Act 8 of 1378) (referred to hereinafter as the 'Act), 791 was amended by section 14 of Act 21 of 1955 by the introduction of section 178A reading: "178A. (1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be on the person from whose possession the goods were seized. (2) This section shall apply to gold, gold manufactures, diamonds and other precious stones, cigarettes and cosmetics and any other goods which the Central Government may, by notification in the Official Gazette, specify in this behalf. (3) Every notification issued under Sub section (2) shall be laid before both Houses of Parliament as soon as may be after it is issued. " It is the constitutional validity of this section that is the common point which arises in these several cases which have been heard together. We have heard on the merits only Civil Appeals 408 to 410 of 1960 and the other cases were posted before us in order that Counsel appearing for the parties in them,. might have an opportunity to be heard upon the common question mentioned earlier. We shall, therefore, refer only to the fact,% of Civil Appeals 408 to 410 of 1960 in dealing with these petitions. Civil Appeals 480 to 410: These appeals come before us on a certificate granted by the High Court of Madras under Arts.132(1) and 133(1)(c) of the Constitution and are directed against the judgment and order of the High Court in two Writ Petitions filed before it by Nathella Sampathu Chetty the sole proprietor of a business in gold and silver, bullion, jewellery etc. carried on in the name of Nathella Sampathu 792 Chetty & Sons (referred to hereafter as the respondent). The facts giving rise to these appeals are briefly as follows : On the morning of June 26, 1956, one Nandgopal an employee of the respondent alighted at the Central station in Madras from the Bombay Express. Nandgopal was intercepted and questioned by a Head Constable of the State Police Service attached to the Prohibition Intelligence Department. Nandgopal admitted that he was in possession of gold which he was bringing for his firm the respondent from Bombay. The Head Constable immediately contacted the officers of the Preventive Section of the Customs Department who were on duty at the Central station who interrogated Nandgopal and Eeized from him four blocks of gold weighing in all about 1,000 tolas. Enquiries were made to verify the story narrated by Nandgopal as to the source from which he obtained the gold and thereafter the Collector of Customs being prima facie of the view that the gold seized had been smuggled, issued notice to the respondent to show cause why the said gold should not be confiscated. The respondent offered his explanation but the Collector held that the respondent had not discharged the onus of proving that the gold was not smug led an onus Customs Act and directed the confiscation of the gold. The respondent thereupon filed a petition (Writ Petition 384 of 1957) under article 226 of the Constitution before the High Court of Madras for the issue of a writ of certiorari or other appropriate writ for quashing the order of the Collector of Customs on various grounds to which we shall advert later, including the constitutional validity of a. 178A. While this writ petition was pending, the respondent filed another petition (,Writ Petition 660 of 1958) for a writ of mandamus directing the Collector to return the gold seized and confiscated by him. 793 The two writ petitions were heard together and by an order dated September 11, 1958, the learned Judges of the High Court held, allowing Writ Petition 384 of 1957, that section 178A of the was void under article 13 of the Con stitution. They further held that even if section 178A were valid, the condition precedent for invoking the rule as to the burden of proof prescribed by the section had not been complied with, in that the customs officer who effected the seizure which preceded the adjudication did not entertain "a reasonable belief that the gold was smuggled", with the result that the order of confiscation was invalid. Besides, the learned Judges were also of the view that section 178A of the could not be invoked in adjudicating a contravention of a notification under the Foreign Exchange Regulation Act which imposed restrictions on the import of gold. Though on these conclusions the order of the Collector confiscating the gold was set aside, the learned Judges held that the respondent was not entitled to an order for the return of the gold, but only to a direction to the Collector to hear and determine the question about the gold seized being smuggled gold without reference to the rule as to onus of proof enacted by section 178A. The appellant, the Collector of Customs, Madras, obtained leave from the High Court under articles 132 and 133 of the Constitution, to appeal to this Court against the orders in writ petition No. 384 of 1957 and No. 660 of 1958 (Civil Appeals 408 and 409) and a similar order was passed in an application for a certificate by the respondent who felt aggrieved by the refusal of the Court in Writ petition No. 660 of 1958 to direct an immediate return of the gold seized (Civil Appeal 410). The three appeals have been consolidated as they arise out of the same transaction. We shall first take up for consideration Civil Appeals 408 and 409 of 1960 filed by the Collector of Customs, because unless those appeals fail there would be no need to decide the relief to which the 794 respondent would be entitled in Civil Appeal 410 of 1960. In order to appreciate the contentions, raised, it would be necessary to set out the statutory provisions which form the background of the impugned provision section 178A of the . The Foreign Exchange Regulation Act, 1947 (Act ' 7 of 1947), was brought into force on March 25, 1947, by a notification issued by the Central Government under section 1(3) of that Act. The preamble to the Act recites: "It is expedient in the economic and financial interests of India to provide for the regulation of. the import and export of currency and bullion. " Section 8 of this Act refers to the import of gold the commodity with which these appeals are concerned. It enacts: "8(1). The Central Government may, by notification in the official Gazette, order that subject to such exemptions, if any, as may be contained in the notification, no person shall except with the general or special permission of the Reserve Bank and on payment of the fee, if any, prescribed bring or send into India any gold or silver or any currency notes or bank notes or coin whether Indian or foreign, Explanation. The bringing or sending into any port or place in India of any such article as aforesaid intended to be taken out of India without being removed from the ship of conveyance in which it is being carried shall nonetheless be deemed to be a bringing, or as the case may be sending, into India of that article for the purposes of this section. " Gold is defined in section 2(f) of this Act thus: " 'gold ' includes gold in the form of Coin, whether legal tender or not, or in the form of bullion or ingot, whether refined or 'not and 795 Jewellery or articles made wholly or. mainly of gold. " These provisions have to be read in conjunction with the provisions of the which form, as it were, integrated provisions in relation to the import and export of, among other commodities, gold, and section 23A of the Foreign Exchange Regulation Act which was introduced by an amendment of 1952 effects this co ordination. This section reads: "23A. Without prejudice to the provisions of section 23 or to any other provision contained in this Act the restrictions imposed by sub sections (1) and (2) of section 8, subsection (1) of section 12 and clause (a) of sub sec tion (1) of section 13 shall be deemed to have been imposed under section 19 of the , and all the provisions of that Act shall have effect. accordingly, except that section 183 thereof shall have effect as if for the word shall ' therein the word "may ' were substituted. " Turning now to the . section 167(8) enacts "167. The offenses mentioned in the first column of the following schedule shall be punishable to the extent mentioned in the third column of the same with reference to such offenses respectively: Section of this Act to Offenses which off Penalties ence has re ference. If any goods, 18 & 19 Such goods the importation of shall be liable which is for the to confiscation; time being prohi and bited or restricted 796 by or under Chapter any person concerned IV of this Act, be in any such offence imported into or shall be liable to a exported from India penalty not exceeding Contrary to such three times the value prohibition or res of the goods, or not triction; or exceeding one thousand rupees. if any attempt be made so to import or export any such goods; or if any such goods be found in any package produced to any officer of Customs as containing no such goods; or if any such goods or any dutiable goods, be found either before or after landing or shipment to have been concealed in any manner on board of any vessel within the limits of any port in India; or if any goods, the exportation of which is prohibited or restricted as aforesaid, be brought to any wharf in order to be put on board of any vessel for exportation contrary to such prohibition or restriction, 797 Section 19 referred to here reads "19. The Central Government may from time to time, by notification in the Official Gazette, prohibit or restrict the bringing or taking by sea or by land goods of any specified description into or out of India across any customs frontier as defined by the Central Government. " The other provisions which have a bearing upon the points arising for discussion with reference to the validity of the impugned section 178A of the are : "section 178. Any thing liable to confiscation under this Act may be seized in any place, in India either upon land or water, or within the Indian Customs waters, by any officer of Customs or other person duly employed for the prevention of smuggling. " "Is. When anything is seized, or any person is arrested, under this Act, the officer or other person making such seizure or arrest shall, on demand of the person in charge of the thing so seized, or of the person so arrested, give him a statement in writing of the reason for such seizure or arrest." "section 182. In every case, except the cases mentioned in section 167, Nos. 26, 72 and 74 to 76, both inclusive, in which, under this Act, anything is liable to confiscation or to increased rates of duty; or any person is liable to penalty, such confiscation, increased rate of duty or penalty may be adjudged (a) without limit, by a Deputy Commissioner or Deputy Collector of Customs, or a Customs collector; (b) up to confiscation of goods not exceeding two hundred and fifty rupees in value and imposition of penalty or increased 798 duty, not exceeding one hundred rupees, by an Assistant Commissioner or Assistant Collector of Customs; (c) up to confiscation of goods not exceeding fifty rupees in value, and imposition of penalty or increased duty not exceeding ten rupees, by such, other subordinate officers of customs as the Chief Customs authority may, from time to time, empower in that half in virtue of their office: Provided that the Chief Customs authority may, in the case of any officer performing the duties of a Customs collector, limit his powers to those indicated in clause (b) or in clause (c) of this section, and may confer on any officer, by name or in virtue of his office, the powers indicated in clauses (a), (b) or (c) of this section." "183. Whenever confiscation is authorized by this Act, the officer adjudging it shall give the owner of the goods an option to pay in lieu of confiscation such fine as the officer thinks fit. " Immediately the Foreign Exchange Regulation Act came into force in March, 1947, a notification was issued on March 25., 1947, under section 8(1) placing a ban on the importation of gold except with the permission of the Reserve Bank. This notification was superseded and replaced by a fresh one dated August 25, 1948, also issued under the powers conferred by sub section (1) of section 8 of the Foreign Exchange Regulation Act and this is the notification which continues in force up to this date and which is relevant to the proceedings against the respondent. The notification ran: "(1) Restrictions on import of gold and silver. In 1 exercise of the powers conferred by 799 sub section 1 of section 8 of the Foreign Exchange Regulation Act, 1947 (Act 7 of 1947) and in supersession of the notification of the Government of India in the late Finance Department No. 12(11) FI/47, dated the 25th March 1947, the Central Government is pleased to direct that except with the general or special permission of the Reserve Bank, no person shall bring or send into India from any place outside India (a) any gold coin, gold bullion, gold sheets or gold ingot whether refined or not; or (b) any silver bullion. . It would be noticed that on the law as it stood upto 1952 before section 23A was inserted in the Foreign Exchange Regulation Act, the importation of gold in contravention of the notification of August 1948 issued under section 8(1) of the Foreign Exchange Regulation Act would have been an importation contrary to section 19 of the , with the result that any person concerned in the act of importation would have been liable to the penalties ,specified in the third column of section 167(8) and the imported gold would have been liable to confiscation under the opening words of that column. The gold being "a thing" liable to confiscation could have been seized by any officer of the Customs under section 178 of the with an obligation on the officer effecting the seizure to give to the person from whom the gold was seized a "statement in writing of the reason for such seizure" (section 181). Thereafter the officers specified in section 182 would have adjudged the confiscation of these goods subject to the option mentioned in section 183 with the modification to this provision enacted by section 23A of the Foreign Exchange Regula tion Act. It would further be manifest that at that date before the gold seized was liable to be dealt with under the third, column of a. 167(8) by 800 an officer adjudicating on the matter under section 182, the burden of proving that the gold was smuggled lay upon the department and unless the adjudging officer who was acting quasi judicially was reasonably satisfied on that point, the confiscation or the imposition of the penalty could not have been ordered. The effect of the imposition of the severe restrictions on the import of gold into this country by the notifications under the Foreign Exchange Regulation Act with a view to defend and conserve the economy of the country in conjunction with the circumstance that the internal production of gold was very little, resulted in a great disparity between the price of gold in India and outside India i.e., in the international markets. This naturally gave a great incentive to smuggling which besides depriving the State of its revenue, also posed a grave threat to national economy. It is only necessary to add that gold was not the only commodity which gave rise to this problem. But as these appeals are concerned with gold, we are confining our examination to that article. Taking these matters into account the Taxation Enquiry Commission, which submitted its report to the Government of India in 1954, recommended a tightening of the law in order effectively to prevent smuggling. After dealing with the administrative problems in regard to the levy and enforcement of Customs duties in Ch. VII of the report the Committee recommended inter alia the amendment of the so as "(1) to make smuggling a criminal offence, and (2) to transfer the onus of proof in respect of offenses relating to smuggling to the person in whose possession any dutiable, restricted or prohibited goods are found. " In pursuance of these recommendations the was mended by Act 21 of 1955 and 801 among others section 178A whose terms we have set out, was introduced into it. As the question of the constitutionality of section 178A has been the subject of elaborate consideration in a few decided cases to which reference was made during the arguments. we consider that it would be convenient if we deal with them before setting out and discussing teh precise grounds on which the challenge to the validity of the provision was rested before us. Very soon after a. 178A was enacted its constitutional validity was challenged by an original petition filed in this Court (Petition 98 of 1956)Babulal Amthalal Mehta vs The Collector of Customs) Calcutta (1).The goods involved in the case were diamonds. Four hundred and seventy five diamond pieces which had been seized from the petitioner, were directed to be confiscated holding them to be smuggled, by the application of the burden of proof laid down in is. The validity of the confiscation was challenged before this Court on the ground that 3. 178A was unconstitutional as being violative of Art.14 of the Constitution and the contention was rejected. It has been urged by the learned Solicitor General, for the appellant, that the points regarding the constitutional validity of B. 178A raised in the present appeal are concluded in his favour by this judgment. We shall, therefore, have to examine the exact scone of this decision in detail which we shall do later, but for the present it is sufficient to state that the case dealt mainly with an objection based on a violation of article 14 of the Constitution which the following extract from the head note would indicate: "Section 118A of the which places the burden of proving that any of the goods mentioned in the section and reasonably believed to be smuggled are not really so on the person from whose possession (1) 802 they are_ seized, is nor,, discriminative in character and does not violate equal protection of law guaranteed by Art.14 of the Constitution". The validity of the section was next attacked before. the High Court of Bombay in a Writ Petition filed under article 226 of the Constitution on the ground that it violated article 19(1)(f) and (g) of the Constitution . M. G. Abrol vs Amichand(1). The article involved, in that case was gold which had been seized from the petitioner and directed to be confiscated by an adjudicating officer under section 182 of the . The case came up for hearing before K. T. Desai, J., and the learned Judge held that section 178A was unconstitutional as being an unreasonable restriction on the citizens ' right to hold property and to trade and also that even assuming the provision to be constitutionally valid, the requirements of the section had, not been complied with in the case before him inasmuch as the seizing officer had not at the moment of seizure, "reasonable belief that the gold seized was smuggled". The next decision in order of date is that of the Bench of the Madras High Court dated March 11, 1957, which is now under appeal before us in Civil Appeals 408 to 410 of 1960. The reasoning of the learned Judges of the Madras High Court is on the same lines as that of K.T. Desai, J., in the judgment just now referred '. Subsequently the Nagpur Bench of the Bombay High Court had to consider the same question and their decision is reported in Pukhraj Champalal Jain vs D. R. Kohli (2). There the learned Judges dissented from the decision of K. T. Desai, J., in M. G. Abrol vs Amichand (1) and of the Madras High Court in Nathella Sampathu Chetty vs The Collector of Customs(&). It may be mentioned that the arguments of the learned Solicitor General on behalf of the appellant were in substance the reasoning on which the decision of the Nagpur Bench rests. To complete (1) at p. 1046, (2) (1959) 61 Bow. L.R. 1230, (3) A I.R. , 803 the narrative it is only necessary to add that an appeal was preferred by the Customs authorities from the decision of K. T. Desai, J. The appeal [however was dismissed on the ground that even if section 178A were valid as held by that Court previously, its terms were not attracted to the particular case, because of the non fulfilment of an essential condition requisite for the application of the section [See M. G. Abrol vs Amichand (1)]. We shall now proceed to deal with the points Urged by learned Counsel for the respondent in support of his plea that the impugned provision violates the fundamental right to hold property under article 19(1)(f) and the right to carry on trade or business under article 19(1)(g) and was not saved by cls. (5) & (6) respectively of article 19. Before we do so, however, it is necessary to advert to the points upon which learned Judges have, in the judgment under appeal. allowed the petition of the, respondent, because in deciding these appeals we have necessarily to pronounce upon them also. Besides holding a. 178A of the which was called in aid by the Collector of Customs to direct the confiscation of the gold seized to be unconstitutional and therefore void under article 13, the learned Judges also upheld two further contentions urged on behalf of the respondent in support of their petition : (1) that section 178A was not attracted to the determination of a question raised in relation to the confiscation of an article imported in contravention of a notification under section 8(1) of the Foreign Exchange Regulation Act, (2) that section 178A required as a pre condition of its applicability, that the goods which were the subject of adjudication must have been seized ",in the reasonable belief that they are smuggled goods" and that in the instant case the Customs Officer effecting the seizure did not or could not entertain such a belief. We consider it Would be convenient if we deal with these two points after examining the constitutional validity of section 178A. (1) 804 Before embarking on this enquiry it is necessary to deal with the argument of the learned Solicitor General that every point about the constitutional validity of section 178A is concluded in his favour by the judgment of this Court in Babulal Amthalal Mehta vs The Collector of Customs, Calcutta (1). we have already extracted the head note of the report in the Supreme Court Reports which would appear to indicate that this Court considered only the impact of article 14 of the Constitution on the provision. Nevertheless, there are some passages in this judgment, which would be immediately referred to on which reliance was placed by the learned Solicitor General in support of his contention that this judgment is an authority for the position not merely that section 178A does not violate article 14 but that it impliedly. if not expressly decides that the restriction imposed by it on the right to hold property or to engage in the business of dealing in gold was a reasonable restriction within article 19(5) & (6) of the Constitution. We will quote these passages in order to examine whether this contention is made out. That judgment after setting out a summary of the provisions of the relating to seizure, the adjudication of confiscation, the imposition of penalties, appeals from the orders of the Customs authorities to the higher revenue authorities and the terms of section 178, proceeds: "No doubt the content and import of the section are very wide. It applies not only to the actual smuggler from whose possession the goods are seized but also to those who came into possession of the goods after having purchased the same after the same has passed through many hands or agencies. For example, if the Customs authorities have a reasonable belief that certain goods in the possession of an innocent party are smuggled goods and the same is seized under the provisions of this Act, then the person from whose possession (1) [1957] S.C.R.1110. 805 the goods were seized, however innocent he may be, has to prove that the goods are not smuggled articles. This is no doubt a very heavy and onerous duty cast on an innocent possessor who, for aught one knows, may have bona fide paid adequate consideration for the purchase of the articles without knowing that the same has been smuggled. The only prerequisite for the application of the section is the subjectivity of the Customs officer in having a reasonable belief that the goods are smuggled. " This passage is followed by an examination of the matters with reference to article 14 expressing the opinion that the petition did not show in what manner there had been a violation of that Article, and the judgment continues: "But Mr. Chatterjee argues that the burden of proof enunciated therein is opposed to fundamental principles of natural justice, as it gives an unrestricted arbitrary and naked power to the customs authorities without lay ing down any standard or norm to be followed for exercising powers under the section. . It is a heavy burden to be laid upon the shoulders of an innocent purchaser who might have come into possession after the article has changed many hands and this, it is alleged, invokes discrimination between him and other litigants and deprives him of the equal protection of the law guaranteed by article 14 of the Constitution. A large number of cases have been cited at the Bar in support of the respective contentions of the parties. " This is followed by a citation from the decisions of this Court in which the scope and content of article 14 were discussed and in particular a passage in the judgment in Budhan Chaudhury vs The State of Bihar(1) where, the principle that article 14 (1) ; , 1048 1049. 806 does not forbid classification on a reasonable and rational basis is extracted. The judgment proceeds: " A cursory perusal of section 178A will at once disclose the well defined classification of goods based on an intelligible differentia. It applies only to certain goods described in sub a. (2) which are or can be easily smuggled. The section applies. only to those goods of the specified kind which have been seized under the Act and in the reasonable belief that they are smuggled goods. It is only those goods which answer the threefold description that come under the, operation of the section. The object of the Act is to prevent, smuggling. The differentia on the basis of which the goods have been classified and the presumption raised by the section obviously have a rational relation to the object sought to be achieved by the Act. . . The impugned section cannot be struck down on the infirmity either of discrimination or illegal classification. " We are therefore satisfied that the decision of this Court considered the validity of section 178A only with reference to article 14 and that it is not a decision regarding the impugned legislation being or not being obnoxious to article 19(1)(f) & (g). It is only necessary to add that at the beginning of the discussion, Govinda Menon, J., specifically points out that he was not considering any attack on section 178A based on an infringement of article 19(1)(f) & (g), for 'he said : "Though Mr. Chatterjee faintly argued that the provisions of article 19(1)(f) & (g) and article 31 of the Constitution had been violated, he did not seriously press those contentions. The main point of the attack was centered on the contention that section 178A was violative of principles of equal protection of the laws guaranteed under article 14 of the Constitution. " 807 We cannot accept the further submission either that, even if this Court did not in terms consider the validity of section 178A with reference to article 19 (1) (f) & (g), still the reasoning by which it rejected the contention that it violated article 14 would be sufficient to cover the former also. No doubt, there are situations when the points regarding a violation of Art; 14 and an objection that a restriction is not reasonable so as to conform to the requirements of article 19(5) or (6) may converge and appear merely as presenting the same question viewed from different angles. Such, for instance, are cases when the denial of equality before the law is based on the ground that the power vested, say, in an administrative authority to affect rights guaranteed to a citizen is arbitrary, being unguided or uncanalised. The vesting of such a power would also amount to the imposition of an unreasonable restriction on the exercise of the guaranteed right to trade or carry on a business etc. Where however, there is guidance and the legislation is challenged on the ground that the law with the definite guidance for which it provides has out stepped the limits of the Constitution by imposing a restraint which is either uncalled for or unreasonable in the circumstances, the scope and content of the enquiry is far removed from the tests of conformity to rational classification adopted for judging whether the law has contravened the requirement of equal protection under article 14. It is therefore necessary for us to consider whether section 178A is obnoxious to the rights guaranteed by article 19(1)(f) & (g) which is the ground upon which the section has been held unconstitutional by the judgment of the Madras High Court under appeal. We have already set out what one might term the historical background and the surrounding circumstances ' which necessitated the enactment of this provision. As already indicated, since the commodity with which the present appeals are concerned is gold, we are referring to that in particular, though the circumstances attendant on the 808 other commodities referred to in section 178A might be similar. As pointed out I already, the disparity between the internal and external price of gold became, by 1948, so great a" to provide considerable incentive to smuggling by making it very profitable. This as, assisted by the very long coast line which India has, coupled with the extensive land frontiers both on the east as well as on the west ignoring for the moment the very small pockets of foreign territory within the subcontinent. Notwithstanding the efforts of the Customs authorities and the Preventive Staff of that department, a considerable volume of the yellow metal did 'seep into the country and efforts had therefore to be made to tighten the law in this regard. It was in pursuance of this endeavour that section 178A was introduced into the in 1955. Ex facie, the impugned provision enacts a rule of evidence and the ratio underlying it is not far to seek,. and it is that the person in possession of the gold would, with certainty in most cases, be in a better position to prove that it was legally within the country than the Customs authorities. In this connection reference may be made to the observations by Lord Goddard, C. J., in B. vs Fitzpatrick (1). Speaking of section 259 of the V. K. Customs Consolidation Act, 1876, which enacted "If in any prosecution in respect of any goods seized for non payment of duties, or any other cause of forfeiture, or for the recovering any penalty or penalties under the Customs Acts, any dispute shall &rise whether the duties of customs have been paid in respect of such goods, or whether the same have been lawfully imported or lawfully unshipped, or concerning the place from whence such goods were brought, then and in every such case the proof thereof shall be on the defendant in such prosecution." (1) , 772. 809 the learned C. J. said "The onus is put on the defendant when there is a dispute in the proceedings whether duty has been paid or whether the goods were lawfully imported. The obvious reasons for this provision is that the facts must be within the knowledge, and often within the exclusive knowledge of the defendant. If, for instance, it is found that he has dealt in prohibited goods, if he can show that he acquired them in the ordinary course of business obviously he would not be guilty of dealing in them with intent to avoid the prohibition. He can prove the positive and, unless he had to undertake the proof, the Crown would generally have to undertake the proof of a negative. Mr. Palkivala, learned Counsel for the respondent, stated that if the impugned section, section 178A, had contented itself with laying down the principle enunciated in the above observations of Goddard, C. J., he would not contend that it was an unreasonable restraint on the citizen 's rights to hold property or on his right to do business guaranteed by article 19 (1) (f) & (g). His submission, however, was that the burden cast upon the person from whom gold were seized transcended the limits of what that person could reasonably be called on to prove and that as the burden cast by section 178A was impossible of being discharged, it amounted not to a law laying down a rule of evidence, but operated virtually to effect a confiscation of the property of a citizen without affording him any real opportunity to establish his right to it. To appreciate properly this argument about the real effect of the provision it is necessary to set out a few facts relating to gold as an article of trade in this country. Learned Counsel on either side agreed that the matters stated in relation to gold and the trade in gold referred to in the following *sage in the judgment of K. T.Desai, J., 810 correctly sums up the position. The learned Judge summarised the position thus: "It is common knowledge that India produces very little gold and that most of the gold available in India is imported gold. A statement has been put in by consent showing the official figures of India 's imports and exports of gold from 1851 to 1956. it shows a net import in the country, after deducting exports, of 353 crores and three lakhs worth of gold. Restrictions on the import of gold were for the first time introduced in India by Finance Department (Central Revenues) Notification No. 53, dated September 4, 1939. By that notification the Central Government in the exercise of the powers conferred by s.19 of the prohibited the bringing or taking by sea or land into British India from any place other than Burma or out of British India to any Place other than Burma gold coin, gold bullion or gold ingots, whether refined or not, except on the autho rity of a licence granted in that behalf by the Reserve Bank of India Till April 1, 1946, gold remained duty free. Thereafter duty was levied on the import of gold bullion, gold plate, gold manufactures etc Gold besides being a store of value, is anarticle of adornment and investment. It is capable of being split and there can be a fusion of diverse quantities of gold. It is easily changeable in form size and shape. The gold available in the market hardly bears any identification mark. It is impossible for person looking at gold to say whether duty has been paid thereon or not or 'whether it has been smuggled. It is precisely the difficulty experienced by the the customs officers with the whole machinery of Government at their disposal in proving that the gold has been smuggled which is itself made a reason for throwing the burden upon the citizens 811 to establish that the gold is not smuggled. Gold an such has no earmark. It is impossible to identify gold in the possession of a person with the gold mentioned in the Bill of Entry of any importer of gold. . Gold has been imported through centuries into this country and it is virtually impossible for a person to establish that any particular quantity of gold in his possession was the gold imported in, the country at a particular time without resort to smuggling. The proof required presupposes the existence of gold in an identifiable form from the time of its import to the time of its ultimate sale to the person from whose possession the same has been seized." Mr. Palkivala, learned Counsel for the respondent, explained to us the special features attaching to gold as a commodity and as a store of value, and of the difficulties, if not impossibility, of identifying one piece of gold from another in the absence of a requirement of marking, and basing himself on this :factual position submitted six grounds in support of his contention that the restriction imposed by section 178 A was unreasonable and we shall deal with these points in the same order : (1) Section 178A, no doubt, on its face purports to be a rule of evidence, but in reality is not so. The purpose of the enquiry by the adjudicating officer is to find out whether the gold seized from a person had been smuggled, and in such an enquiry the fact to be proved, viz., that the gold had been smuggled is statutorily established not as an inference from. basic facts, which would indicate the smuggled character of the Gold seized, but from the mere belief of the seizing officer that the gold seized was smuggled, (2) It was said on the other side that the requirement in section 178 A that the officer seizing the gold must entertain " 'a reasonable belief" that the gold was smuggled provided an adequate safeguard 812 to the person affected which would render the restriction imposed reasonable within cls. (5) & (6) of article 19. This argument is untenable. If the reasonable belief was a matter for the subjective satisfaction , of the seizing officer, as seems to be implied from the observations of this Court in Babulal Amthalal Mehta vs The Collector of Customs, Calcutta (1), it provides no safeguard at all for the person from whom the gold is seized. Even if, on the other hand, the test is objective, in the sense that at the stage of the adjudication under section 182 the grounds upon which the belief was entertained could be the subject matter of enquiry it furnishes no safeguard either, because the "reasonableness" of the belief regarding the smuggled character of the gold would have to be judged by the adjudicating officer with reference to the information which the seizing officer had at the moment of seizure, and that information must necessarily have been obtained behind the back of the person from whom the gold had been seized and before the officer commenced any enquiry to ascertain the truth or otherwise of the information conveyed to him, (3) There is no reasonable or rational connection between the fact to be proved, viz. ' that the gold was smuggled and the fact from which such an inference is permitted to be drawn by the impugned provision, viz., the reasonable belief of the officer effecting the seizure that the gold was smuggled. There is therefore no adequate basis on which the provision could be sustained as a rule of evidence, (4) The operation of section 178A is not restricted in point of time or to persons actually suspected to be connected with the import but extends also to persons who are able to establish bona fide acquisition of gold but who are unable to prove how the person from whom they acquired, obtained the gold they sold, (1) 813 (5) A presumption of this sort might be reasonable in respect of goods which are dangerous or noxious per se, like firearms or poison, since ordinarily people might be expected to be. on their guard before obtaining such goods to ensure that their acquisition was lawful and in accordance with I the formalities, if any prescribed by the relevant statute or rule. Gold, however, is not such a type of commodity. It is, an inncouous article of commerce and is under the law a subject of unrestricted trade within the country. The burden of proof of the sort imposed by a. 178A, in respect of such a commodity, is therefore unreason able, (6) The burden of proof cast by section 178A is, in most cases, impossible of being discharged be cause: (a) it extends to facts which would not be in the possession of a bona fide purchaser and would comprise matters which he never knew, or could never know, (b) large quantities of gold have been imported into India before restrictions were imposed in 1939. The net imports upto 1939 are estimated at over 353 crores of rupees which at the present price of gold would be over 2,000 crores of rupees. As gold which is sold in the market is not identifiable, it would be impossible for any purchaser to say whether the gold that he was 'buying was that which had been imported lawfully before 1939 or had come into the country, after. 1939 after payment of duty or had been. smuggled into the country in violation of the Foreign Exchange Control Regulations. The section, therefore, practically prohibits, all holding of gold, or trade in gold and subjects the holding of and the trade in gold to the penalty of confiscation, indigenous gold has been produced in mines in India both before and after 1939 and there is nothing to differentiate this from imported gold, (d) it is a commodity which frequently changes hands because of regular trade and widespread 814 use as ornaments etc., and finally (e) the indentification of gold is impossible because of frequent meltings and fusion of separate pieces and the absence of any system of compulsory marking. We shall deal with each of these points and examine them in the light of the submissions made by the learned Solicitor General in answer. Grounds 1 and 3 which we have set out earlier may be taken up together since they are merely different modes of expressing the same contention. The point raised is that there is no rational connection between the fact from which the statute raises the presumption and the fact which has to be proved in order that the goods might be the subject of confiscation. The argument is that the fact from which the presumption is drawn is the reasonable belief of the officer effecting the seizure that the article seized is smuggled; while the fact which by the terms of the statute it is held to prove is that the gold seized is smuggled; with the result that the practical effect of the provision is that there is a statutory direction to the adjudicating officer to treat the gold as smuggled so as to entitle him to confiscate the same. It is only if learned Counsel for the respondent is right that the effect of the section is as above that the several decisions of the American Courts to which he invited our attention, could have any application. Learned Counsel relied particularly on the decisions in Bailey vs State of Alabama (1), and Manley vs State of Georgia (2). The first of these was concerned with the validity of a law of the State of Alabama by which refusal without just cause, to perform the labour agreed to be performed in a written contract of employment under which the employee had obtained money which he did not refund was made prima facie evidence of an intent to commit a fraud. The Supreme Court held the law invalid. Two grounds were urged in support of the argument that the legislation was unconstitutional. The first was that (1) ; : ; (2) L. Ed; 5 5. 815 it was in violation of the 13th amendment against "involuntary servitude except as punishment for crime", the other that the law was in violation of due 'Process ' clause contained in the 14th amendment The Supreme Court upheld both these contentions, but what is relevant to the present context and on which learned Counsel relied was the reason assigned for holding that the rule of evidence enacted by the impugned statute violated the requirement of due 'process '. Reliance was placed for the State before the Supreme Court on the fact that the presumption raised was not conclusive but was open to rebuttal by the accused, but this was held not to be of avail, because according to the rule of evidence enforced by the Courts of Alabama, the accused, for the purpose of rebutting the statutory presumption, was not allowed to testify as to his uncommunicated motives, purposes or intentions, so that virtually it amounted to a conclusive presumption against the accused. The statute whose validity was attacked in the second American decision referred to was one declaring that every insolvency of a bank shall be deemed fraudulent and subjected the directors to imprisonment unless they repelled the presumption of fraud by showing that the affairs of the bank had been fairly and legally administered. Head Note 1 to this case sums up the American law on the subject of the constitutional validity with reference to the due 'process ' clause, of laws of evidence creating presumptions. It runs: "1. State legislation that proof of one fact, or group of facts, shall constitute prima facie evidence of the main or ultimate fact in issue, does not constitute a denial of due process of law if there is a rational connection between what is proof and what is to be inferred, and the presumption is not un reasonable, and is not made conclusive of the rights of the person against whom it is raised. " 116 In regard to the American decisions of which only a few were cited, including those just now get out, the principle underlying them is to be found summarized in Rottschaefer 's Constitutional Law at p. 835, where the learned author says: "The power of a legislature to prescribe the rules of evidence is universally recognised, but it is equally well established that due process limits it in this matter. It may establish rebuttable presumptions only if there is a rational connection between what is proved and what is permitted to be inferred therefrom. " It would be seen that the decisions proceed on the application of the 'due process" clause of the American Constitution. Though the tests of ,reasonableness ' laid down by cls. (2) to (6) of article 19 might in great part coincide with that for judging of 'due process ', it must not be assumed that these are identical, for it has to be borne in mind that the Constitution framers deliberately avoided in this context the use of the expression due process ' with its comprehensiveness, flexibility and attendant vagueness, in favour of a somewhat more definite word " 'reasonable", and caution has, therefore to be exercised before the literal application of American decisions. In making these observations we are. merely repeating a warning found in the judgment of this Court in A. section Krishna vs The State of Madras (1), where Venkatarama Ayyar, J., speaking with reference to the point now under discussion after quoting the passage already extracted from Rottschaefer 's treatise stated: "The law would thus appear to be based on the due process clause, and it is extremely doubtful whether it can have application under our Constitution. " With this caution we shall proceed to examine the submission of learned Counsel regarding the (1) ; , 412. 817 absence of any rational connection between the fact to be proved and the fact on which the presumption is raised. An analysis of the arguments of the learned Counsel shows that the real legal objection to the provision lay in the sixth point urged by him, viz., the impossibility of discharging the burden of proof cast by section 178A, which thus virtually results in a confiscation of property without a judicial adjudication or condemnation. Pausing here we might mention that two matters might be urged as flowing from or as the necessary result of the impugned provision: (1) that even a bona fide possessor of the goods might be deprived of his property notwithstanding that there was no basis even for a suspicion that he was a party to the smuggling or had any knowledge that the goods in his possession were smuggled goods; and (2) that the burden cast on the possessor to prove the negative, namely, that the gold was not smuggled cast an impossible burden upon the person from whom the goods are seized as it virtually amounts to a confiscation by the law without any reasonable proof before a quasi judicial authority that the gold was smuggled. To this last, the sixth point, we shall advert in its proper place, but what we are concerned to point out at this stage is that apart from the point about the impossibility of discharging the onus of proof cast by the section, there is little basis for the argument that there is lack of any rational connection between the facts giving rise to the presumption and the fact presumed, and to this we shall now proceed. This question about the lack of rational connection may be considered from two points of view. First Mr. Palkivala does not impugn the constitutional validity of section 106 of the Indian Evidence Act or the legislative application of the principle underlying it to any concrete case. It need hardly be pointed out that in every case without exception, the possessor of the gold would be the person beat acquainted with the manner of 818 his acquisition and the circumstances attendant on or connected with that acquisition. It was part of the learned Counsel 's submission that he could not successfully impugn the validity of a provision on the terms of section 259 of the U. K. Customs Consolidation Act. Recalling the decision in R. vs Fitzpatrick (1), already referred to, we might mention that the prosecution there was for a violation of section 186 of the U. K. Customs Consolidation Act, 1876, which, so far as material, was in substantially the same terms as the relevant portion of section 167(8) of the , the essential ingredient of the offence being indicated by the words "person concerned in dealing with goods the import of which is prohibited or which are liable to duty with intent to defraud His Majesty", and it was a violation of this section that Fitzpatrick was found guilty of by the application of the rule as to onus of proof prescribed by section 259 extracted earlier. If in a prosecution for dealing in smuggled goods the onus could with constitutional propriety be cast upon the accused to prove that the goods were not smuggled, it is difficult to see any reasonable basis for the contention that where the offence charged against a person is not dealing in but possession of ,smuggled goods, there is a constitutional bar on the burden being so laid. Secondly, is learned Counsel correct in his ,submission that under a. 178A the onus is cast upon the possessor of the goods seized by reason only of the reasonable belief of the seizing officer that the goods seized by him are smuggled ? It is to be noted that the seizure by the officer in the belief that the goods are smuggled does not by itself operate to effect the confiscation or deprive the owner of his property in the goods. This result, however, follows only on an order of an adjudicating officer who investigates into the complaint regarding the defendant 's possession of the smuggled goods. As; we shall have occasion to point out (1) , 772. 819 later the entire evidence in the, possession of the seizing officer would be and has to be before the officer adjudicating the confiscation under section 182 of the . No doubt, on the language of section 178A the presumption of the goods being smuggled arises only when the seizure is made by an officer entertaining a reasonable belief that the goods are smuggled, and in that sense the reasonable belief of the seizing officer is a pre requisite for the statutory onus to arise. It is also true that at the stage of the adjudication the reasonableness of the belief of the officer effecting the seizure that the goods are smuggled would be the subject matter of investigation by the adjudicating officer. Nevertheless it is manifest that at the stage of the adjudication (when only the rule of evidence laid down by the section comes into operation) the very facts which led the seizing officer to effect the seizure ' as distinguished from their significance as affording a reasonable belief for the seizing officer to hold that the goods are smuggled are before the adjudicating officer. These facts which justified the seizing officer to reasonably believe that the goods were smuggled would certainly impart a rational connection between the facts on which the presumption is raised and the fact to be proved, so that whatever other constitutional infirmity might attach to the impugned provision, the lack of rational connection is not one of them. It appears to us therefore that the argument regarding the lack of rational connection has no substance. It is derived wholly on a literal reading of section 178 A and would not be available if the provisions were read in the manner we have just now indicated. The second of the grounds urged by learned Counsel was that the requirement of section 17 8 A that the belief of the officer seizing the goods should rest of reasonable grounds provided no safeguard to the citizen, as the seizing officer who acts administratively entertains the belief on unproved information gathered from sources which most often are not and 820 in practice will not be possible to be disclosed to the party affected. In connection with this point two alternative submissions were made : (1) that the reasonable belief of the officer effecting the seizure was one entirely for his subjective satisfaction and that this rendered the protection wholly illusory and therefore patently unreasonable. This was advanced on the basis of the passage in the judgment of this Court in Babulal Amthalal Mehta vs The Collector of Customs, Calcutta (1), already extracted reading : "the only pre requisite for the application of the section is the subjectivity of the Customs Officer in having a reasonable belief that the goods are smuggled. " The learned Solicitor General, on the other hand pointed out that this was not really part of the decision, but was just an observation and that he would not support it. The learned Solicitor General submitted that a seizure to which section 178 A was applicable was merely a preliminary to proceedings before a quasi judicial authority under section 182. When the matter comes before the latter authority, and anterior to that authority invoking the presumption raised by section 178 A, it would, on the terms of the section, have to be satisfied that the seizure was made "in the reasonable belief that the goods seized were goods that had been smuggled". At that stage the enquiry is not and cannot be confined as to whether the seizing officer bona fide entertained the belief, but must necessarily extend to an examination of the grounds upon which that belief was entertained with a view to ascertain whether the belief was reasonable. It might be that the entirety of the evidence which conceivably in several cases consist of information communicated by informers might not be made available, to the person affected, but still the adjudicating officer would have to satisfy himself that the requirements (1) 821 of section 178 A had been complied with before invoking the presumption laid down by that section. Mr. Palkivala 's alternative submission was that even if test of 'reasonable belief ' was not subjective but was objective, in that the point as to whether the belief was reasonable was open to examination by the adjudicating officer under section 182, still, this provided no sufficient safeguard, because, if ",information not tested by cross examination" could from the basis of "reasonable belief", by applying the same tests, the adjudicating officer would and must in most cases reach the same conclusion. It is, no doubt, true that in some cases there might be pieces of information on the basis of which the seizure was effected which might not be capable of being disclosed to the affected party because it might consist of information supplied by customs informers, but if that information would have to stand the test of scrutiny as to credibility by an independent officer dealing with it in a quasi judicial capacity, it cannot be said that the protection is illusory. It has also to be added that at the stage of appeal or revision from the orders of the officer adjudging confiscation under section 182 of the Act each successive appellate or Revisional authority has also to address itself to this requirement. We shall now pass on to the fourth of the points urged by learned Counsel for the petitioner that the onus of proof is unreasonable, in that it was not restricted in point of time or to persons connected with the import. The point suggested may be expanded in these terms : What the party affected has to prove is not that his acquisition has been bona fide, which of course be might be in a position to prove and might properly be required to prove, but that somebody else over whom he has no control and of whose actions he would, in most cases, be completely ignorant has similarly bona fide 822 acquired the gold without violating the law and so on until one reached the stage of the origin of the gold which is the subject of seizure and of adjudication before the Customs authority. It would be seen that this is really the argument upon which the sixth of the points urged by learned Counsel rests and therefore it will be convenient to examine the soundness of the contention and the answers which have been made on the other side after dealing with point No. 5. The fifth point relates to the fact that the presumption raised by the section is about the possession of an innocuous article of property which under the law is the subject of unrestricted trade in the open market as distinguished from articles which are inherently dangerous such as firearms or Poisonous drugs, in regard to which possession and dealing are legitimately subject to severe restrictions. Learned Counsel is, no doubt, right in his submission that gold as a commodity is an innocuous article of commerce, that articles made of gold have been used as part of jewellery by the middle and upper classes from the beginning of time, that it, has served as a store of value from ancient times and that the very large number of people in this country are in possession of gold for the purposes just now mentioned. But that however is not any conclusive consideration in support of the invalidity of a law which seeks to throw the burden of establishing possession as legal under the law, upon the possessor. It cannot be seriously disputed that in most of the cases the possessor of the gold would certainly be in a position to establish the mode of his acquisition (subject to the last of the points about the burden of proof being impossible to discharge), which would more often than not take it out of the category of smuggled gold. It is only in those cases where reasonable suspicion exists that the gold in the possession of a person has come into the country by illicit means, that there is power in an officer to affect the seizure and in most 823 of the cases the innocent possessor would be in a position to discharge the onus. It is therefore in cases where a person is unable to prove how he got into possession of the gold found with him or where his explanations are found to be false or unacceptable that in the large majority of cases the section would normally be invoked. Besides these, it would be applied also in cases where a person is able to prove that his acquisition was bona fide but that the persons from whom he acquired or one higher up in the series of prior owners is unable to explain satisfactorily his possession, and it is only in these marginal or extreme cases that the onus created by the section might be contended to be harsh and unreasonable. Learned Counsel is, therefore, not right in suggesting that section 178A operated, as it were, by itself to confiscate the gold and gold ornaments in the possession of the entire population of the country, each individual being compelled before the restoration of the gold to him to strictly prove either that the gold was of indigenous origin or had been imported prior to 1939, or if imported subsequently bad either been permitted to be imported or had paid duty, if such duty was leviable. We consider that this is not the effect of the section and that it does not, on any reasonable construction, justify this picture of its operation. We shall now proceed to consider the last of the points raised by learned Council in conjunction with point No. 4 which we had reserved for being examined along with it. This point learned Counsel expanded in the following terms. The burden of proof cast by the section is or is almost impossible of discharge, because (1) it extends to facts which would not be in the possession of bona fide purchaser at all, facts which he never knew and which be could never reasonably ascertain ; (2) large quantities of gold have been imported into this country before the introduction of restrictions on their importation by virtue of the legislation 824 brought into force from 1939. In this context, learned Counsel relied on the several matters set out in the passage from the judgment of K. T. Desai, J., extracted earlier and laid particular emphasis on the fact : (a) that gold was held in myriad forms and for diverse purposes by a sizeable portion of the population of the country, (b) that gold in its several forms was incapable of being identified as indigenous or imported, or if imported had paid duty or not. In view of these circumstances he urged that to call upon any person to prove any thing more, than that his acquisition of the gold was bona fide and without violation of the law would be to cast an impossible burden upon the possessor. Learned Counsel further urged that the precise reason for which the burden had been thrown upon the possessor was because of the inability of the State to establish before the quasi judicial authorities acting under section 182 reasonable proof that the gold seized was smuggled. He therefore submitted that if Government with all its administrative machinery operating in several fields was unable to lead evidence which could satisfy the, Collector of Customs that the gold seized had an illicit origin, how could it be reasonable to expect the individual possessor, who knew nothing beyond how he himself came by the gold, to establish the negative, viz., that the gold in his possession had not been smuggled but was lawfully within the country. Before considering these submissions it is necessary to mention one point suggested in answer by the learned Solicitor General which has apparently found favour with the learned Judges of the Division Bench of the Bombay High Court in Pukhraj Champalal Jain vs D. R. Kohli(1). The point was this: The Central Board of Revenue lad issued certain administrative instructions as regards the manner in which the Customs Officers should regulate their procedure before the goods are adjudged to be confiscated under the provisions of the . These are sell , out at p. 1240 (1) 825 of the Report in 61 Bombay Law Reporter and need not be repeated here. The learned Solicitor General 's argument was that as the section was being administered subject to these safeguards, the provision must be held to be a reasonable restriction within (6) of article 19 of the Constitution. We are clearly of the opinion that the argument about the relevance of this matter is incorrect and must be rejected. This Court has held in numerous rulings, to which it is un necessary to refer, that the possibility of the abuse of the powers under the provisions contained in any statute is no ground for declaring the provision to be unreasonable or void. Commenting on a passage in the judgement of the Court of Appeal of Northern Ireland which stated: "If such powers are capable of being exercised reasonably it is impossible to say that they may not also be exercised unreasonably" and treating this as a ground for holding the statute invalid Viscount Simonds observed in Belfast Corporation vs O. D. Commission(1): "It appears to me that the short answer to this contention (and I hope its shortness will not be regarded as disrespect) is that the validity of a measure is not to be determined by its application to particular cases. . If it is not so exercised (i.e., if the powers are abused) it is open to challenge and there is no need for express provision for its challenge in the statute". The possibility of abuse of a statute otherwise valid does not impart to it any element of invalidity. The converse must also follow that a statute which is otherwise, invalid as being unreasonable cannot be saved by its being administered in a reasonable manner. The constitutional validity of the statute would have to be determined on the basis of its (1) , 520 521 826 provisions and on the ambit of its operation as reasonably construed. If so judged it passes the test of reasonableness, possibility of the powers conferred being improperly used is no ground for pronouncing the law itself invalid and similarly if the law properly interpreted and tested in the light of the requirements set out in Part III of the Constitution does not pass the test it cannot be pronounced valid merely because it is administered in a manner which might not conflict with the constitutional requirements. In saying this we are not to be understood as laying down that a law which might operate harshly but still be constitutionally valid should be operated always with harshness or that reasonableness and justness ought not to guide the actual administration of such laws. We shall now proceed to examine what in effect is the central point in the argument of the learned Counsel for the respondent which might be split up into two heads: (1) Under section 178 A the burden of proof is cast upon a person from whom the goods have been seized which is impossible for him to discharge, with the consequence that though in form the impugned section purports to be a rule of evidence, it is virtually a law which per se effects confiscation in (,very ease to which it is applicable. (2) Is such a law a reasonable restriction on the right to hold property or on the right to carry on business within cls. (5) & (6) of article 19, but they may be considered together. Section 178 A operates to cast the burden of proof on the person from whose possession goods specified in its sub section (2) are seized to establish that the goods are not smuggled. It must be apparent that this will include, in several cases, persons who are concerned in and are charged with being concerned in the act of illicit importation. In their case, as we have already pointed out, learned Counsel admits that the onus is properly shifted and that such a provision would be reasonable and so constitutionally valid, though undoubtedly it might be possible for the State to prove 827 its case even without the aid of the presumption raised by section 178A. Again there might be some cases where goods are seized from a person who is unable to account satisfactorily for his ownership or possession. In such cases also we did not understand learned counsel for the petitioner to suggest that the shifting of the burden of proof would be unconstitutional, for surely the principle underlying section 106 of the Evidence Act;which, it is conceded, enunciates a just and reasonable principle would serve to sustain the validity of the impugned provision. The two classes of cases which we have just set out would in themselves constitute most of the cases in which suspicion or information of the type which leads to seizure and the ensuing proceedings would occur. Section 178A however does not exhaust those classes. and that is the ground of complaint by the learned Counsel, and it is precisely on this basis or for this reason that learned Counsel contends that the entire provision is constitutionally invalid. This analysis would show that the provisions of the section are constitutionally valid in the sense of being reasonable restrictions on the right to hold property or to carry on trade or business in the large percentage of cases to which the section would apply, and. it is only in the marginal cases already described that, it can, with any justification, be contended that the restriction is unreasonable. From this position, the question that arises is whether because of the inclusion of this type of case the impugned provision should be held to be constitutionally invalid. This has to be taken in conjunction with what is obviously correct, that any severance of the marginal cases and their exclusion from the operation of the provision would greatly reduce its effectiveness and provide innumerable loop holes for easy evasion. It is in this context that the test for ascertaining the "reasonableness" postulated of the restrictions in cls. (2) to (6) of article 19 assumes great. relevance and crucial importance. There are several decisions of this Court in which the relevant 828 criteria have been laid down but we consider it sufficient to refer to a passage in the judgment of Patanjali Sastri, C. J., in State of Madras vs V. G. Row(,). The learned Chief Justice said at p. 607 of the Report: "It is important in this context, to bear in mind that the test of reasonableness, wherever prescribed, should be applied to each individual statute impugned, and no abstract standard, or general pattern of reasonableness can be laid down as applicable to all cases. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed. , the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at ', he time, should all enter into the judicial verdict. " It would be apparent that this is in line with the great principle underlying the structure of the rights guaranteed by article 19, viz., a balancing of the need for individual liberty in the matter inter alia of the right to hold property or of the right to trade, with the need for social control in order that the freedoms guaranteed to the individual subserve the larger needs moral, social, economic and political of the community and thus ensure orderly prog ress towards the goal indicated by the preamble. It would follow that the reasonableness of the restraint would have to be judged by the magnitude of the evil which it is the purpose of the restraint to curb or eliminate. The submission of the learned Solicitor General was that the reasonableness of the impugned provision had to be judged in the light of the widespread smuggling in commodities like gold which if not checked was calculated to destroy national economy and hamper economic stability and progress, and that no (1) ; , 607. 829 reasonable alternative to the provision would achieve the desired end. In this connection he drew our attention to the Report of the Taxation Enquiry Commission, 1953 54, which pointed out the factual position regarding the existence of widespread smuggling in certain commodities including inter alia gold. They stated at p. 320 of the Report: "11. Smuggling now constitutes not only a loophole for escaping duties but also a threat to the effective fulfilment of the objectives of foreign trade control. The existence of foreign pockets in the country accentuates the danger. The extent of the leakage of revenue that takes place through this process cannot be estimated even roughly, but, we understand, it is not unlikely that it is substantial. Apart from its deleterious effect on legitimate trade, it also entails the outlay of an appreciable amount of public funds on patrol vessels along the sea coasts and permanent works along the land border, and watch and ward staff on a generous scale. It is, there. fore, necessary, in our opinion, that stringent measures, both legal and administrative should be adopted with a view to minimising the scope of this evil. " The deleterious effects of smuggling, as pointed out in the extract from the Report, are real and it is not in dispute that the prevention and eradication of Smuggling is a proper and legally attainable,objective and that this is sought to be achieved by the relevant law. If therefore for the purpose of achieving the desired objective and to ensure that the intentions of Parliament shall not be defeated a law is enacted which operates somewhat harshly on a small section of the public, taken in conjunction with the position that without a law in that form and with that amplitude smuggling might not be possible of being effectively checked, the question arises whether the law could be held to be violative of the 830 freedom guaranteed by article 19(1)(f) & (g) as imposing an unreasonable restrain. That the restrictions are in the "interest of the general public" is beyond controversy. But is the social good to be achieved by the legislation so disproportionately small that on balance it could be said that it has proceeded beyond the limits of reasonableness? We would answer this in the negative. We would only add that there is authority for the position that "acts innocent in themselves may be prohibited and the restrictions in that regard would be reasonable, if the same were necessary to secure the efficient enforcement of valid provisions. The inclusion of a reasonable margin to ensure effective enforcement will not stamp a law otherwise valid as within legislative competence with the character of uncon stitutionality as being unreasonable" [vide Manohar Lal vs State of Punjab (1) and Ram Dhan Dass vs State of Punjab (2) Having given the matter our best attention we have arrived at the conclusion that the impugned legislation has not overstepped the limits set by the Constitution and in saying this we have adopted the test laid down in State of Madras vs V. G. ROW (3) whose terms we have quoted at the start of this discussion. Proceeding therefore on the basis that the impugned provision was constitutionally valid we have still to consider two further points on the basis of which learned Judges of the High Court upheld the case of the respondent even on the assumption that section 178A was constitutionally valid. The first of these grounds was that the impugned section 178A which had been introduced by the Act of 1955 (Act 21 of 1955) is not attracted to the prohibitions enacted by section 23A of the Foreign Exchange Regulation Act. The reasoning on 'which this conclusion was reached was that section 23A, whose terms we have set out, when enacted in 1952 in effect incorporated into the provisions of the Foreign Exchange Regulation Act all the relevant provisions of the , as that (1) ; (2) ; (3) ; , 607. 831 enactment stood in 1952, with the result that any subsequent amendments to the did not and could not affect, modify or enlarge the scope of the incorporated which had become part of the Foreign Exchange Regulation Act. In support of this conclusion the learned Judges of the High Court have relied largely on the decision of the Privy Council in The Secretary of State for India in Council vs Hindustan Co operative Insurance Society Ltd. (1). We consider that the legislation regarding which the Privy Council rendered the decision bears no resemblance, whatever to the matter now on hand and that the ruling in The Secretary of State for India in Council vs Hindustan Co operative Insurance Society Ltd. (1), cannot therefore furnish any guidances or authority applicable to the interpretation of section 23A of the Foreign Exchange Regulation Act. To consider that the decision of the Privy Council; has any relevance to the construction of the legal effect of the terms of section 23A of the Foreign Exchange Regulation Act is to ignore the distinction between a mere reference to or a citation of one statute in another and an incorporation which in effect means the bodily lifting of the provisions of one enactment and making it part of another so much so that the repeal of the former leaves the latter wholly un touched. In the case, however, of a reference or a citation of one enactment by another without incorporation, the effect of a repeal of the one "referred to" is that set out in section 8(1) of the General Clauses Act: "8. (1) Where this Act, or any Central Act or Regulation made: after the commencement of this Act, repeals and re enacts., with or without modification, any provision of a former enactment, then references in any other enactment or in any instrument to the provision so repealed shall, unless a different (1) [1931] L.R. 58 I.A. 259. 832 intention appears : be construed as references to the provision so re enacted. " On the other hand, the effect of incorporation is as stated by Brett, L. J., in Clarke vs Bradlaugh(1): "Where a statute is incorporated, by reference, into a second statute the repeal of the first statute by a third does not affect the second". This is analogous to, though not identical with the principle embodied in section 6A of the General Clauses Act enacted to define the effect of repeals effected by repealing and amending Acts which runs in these terms : "6A. Where any Central Act or Regulation made after the commencement of this Act repeals any enactment by which the text of any Central Act or Regulation was amended by the express omission, insertion or substitution of any matter, then, unless a different intention appears, the repeal shall not affect the continuance of any such amendment made by the enactment so repealed and in operation at the time of such repeal. " We say not identical ' because in the class of cases contemplated by section 6A of the General Clauses Act, the function of the incorporating legislation is almost wholly to effect the incorporation and when that is accomplished, they die as it were a natural death which is formally effected by their repeal. In cases, however, dealt with by Brett, L. J., the legislation from which provision, . are absorbed continue to retain their efficacy and usefulness and their independent operation even after the incorporation is effected. We consider that on the language of the provisions in the two Acts section 19 of the and section 23A of the Foreign Exchange Regulation Act there is no scope for any argument that there (1) 833 has been any incorporation of the provisions of the earlier statute in the later. We shall repeat the terms of section 19 of the which runs : "19. The Central Government may from time to time, by notification in the Official Gazette, prohibit or restrict the bringing or taking by sea or by land goods of any specified description into or out of India across any customs frontier as defined by the Central Government." Section 8(1) of the Foreign Exchange Regulation Act enables similar notifications by the Central Government in these terms: "8. (1) The Central Government may, by notification in the Official Gazette, order that subject to such exemptions, if any, as may be contained in the notification, no person shall, except with the general or special permission of the Reserve Bank and on payment of the fee, if any, prescribed bring or send into India any gold or silver or any currency notes or bank notes or coin whether Indian or foreign. Explanation. The bringing or sending into any port or place in India of any such article as aforesaid intended to be taken out of India without being removed from the ship or conveyance in which it is being carried shall nonetheless be deemed to be a bringing, or as the case may be, sending, into India of that article for the purposes of this section. " In this situation section 23A of the Foreign Exchange Regulation Act enacts: ". . the restrictions imposed by sub section (1) of section 8 shall be deemed to have been imposed under section 19 834 of the , 'and all the provisions of that Act shall have effect accordingly. . . The effect, therefore, of section 23A is to treat the text of the notification by the Central Government under section 8(1) as if it had been issued under s ' 19 of the with the title and the recital of the source of power appropriate to it by the creation of a legal fiction. It would be obvious that in the context and on the language here employed, if section 19 of the were repealed there would no longer be any legal foundation for invoking the penal provisions of the to a contravention of a notification under section 8(1) of the Foreign Exchange Regulation Act. This conclusion is reinforced by a comparison of the usual and normal or recognized formulae generally employed to effect incorporation, such that changes in or even repeal of the incorporated statute is not intended per se to affect the operation of the incorporating legislation. It is sufficient to pick out a few of the well known formulae employed which would indicate that normally the draftsman does not leave his intentions in doubt. For instance, in section 20 of 53 and 54 Vict. 70 Housing of the Working Classes Act, 1890, the words used were, "shall,, for that purpose, be deemed to form. part of this Act in the same manner as if they were enacted in the body thereof,". In 54 and 55 Vict. 19, section 1(3), the language employed was "The provisions of section 134 of the said Act (set out in the schedule) shall apply as if they were herein reenacted. " To take more modern instancess 10 and 11 George VI Ch. 51, (the Town and Country Planning Act, 1947), section 44(1) enacts : 835 "Sections 19 to 30 of the Act of 1944 which provide for the disposal,and appropriation by local Planning Authorities of land acquired or appropriated under Part I of that Act, 'for the carrying out by such authorities of development of such land, and for other matters arising in relation to the acquisition of land in that part shall, except so far as repealed by this Act, be incorporated with this part of this Act, subject to the amendments specified in the second column of the following Schedule of this Act and of the following provision of this section". 6 & 7 Eliz. 2 Ch. 63 (the Park Lane Improvement Act, 1958), section 5 reads: "The Land Clauses Act (other than the excepted provision); so far as they are applicable for the purposes of this Act and are Dot inconsistent with the provisions thereof, are hereby incorporated with this Act. " A comparison of the formulae with the text of section 23A shows that the reference in it to section 19 of the is merely for rendering notifications under the named provisions of the Foreign Exchange Regulations Act to operate as notifications under the , and that it cannot have the effect of incorporating the relevant provisions of the earlier Act into the Act of 1947, so as to attract the rule formulated by Brett, L. J., in Clarke vs Bradlaugh already quoted. A close examination of the decision of the Privy Council in The Secretary of State for India in Council vs Hindustan Co operative Insurance Society Ltd. (1) would show that the incorporation effected in the statute there under consideration the Calcutta Improvement Trust Act, 1911 referred to by their Lordship as the "Local Act" was in express terms and in the form illustrated by 54 & 55 Vict., Ch. 19, just now referred to. The "Local Act" in (1) (1931) L.R. 58 I.A. 259. 836 dealing with the acquisition of Land for the purposes designated by it, made provision for the acquisition under the Land Acquisition Act, and the provisions of the Land Act Acquisition were subjected to numerous modifications which were set out in the Schedule, so that in effect the " 'Local Act" was held to be the enactment of a Special Law for the acquisition ;of land for the special purpose. It was in the context of these and several other provisions which pointed to the absorption of certain of the provisions of the Land Acquisition Act into the "Local Act" with vital modifications that their Lordships stated: "But their Lordships think that there are other and perhaps more cogent objections to this contention of the Secretary of State, and their Lordships are not prepared to hold that the sub section in question, which was not enacted till 1921, can be regarded as incorpo rated in the Local Act of 1911. It was not part of the Land Acquisition Act "hen the local Act was passed, nor in adopting the provisions of the Land Acquisition Act is there anything to suggest that the Bengal Legislature, intended to bind themselves to any future additions which might be made to that Act. It is at least conceivable that new provisions might have been added to the Land Acquisition Act which would be wholly unsuitable to the local code. Nor again, does Act XIX of 1921 contain any provision that the amendments enacted by it are to be treated as in any, way retrospective, or are to be regarded as affecting any other enactment than the Land Acquisition Act itself. Their Lordships regard the local Act as doing nothing more than incorporating certain provisions from and existing Act, and for convenience of drafting doing so by reference to that Act, instead of setting out for itself at length the provisions which it was desired to adopt. " 837 It was for this, among other reasons, that the Judicial Committee held that rights of appeal created by amendments effected to the Land Acquisition Act subsequent to the enactment of the Local Act were not attracted to the incorporated provisions in the "Local Act". We consider that there is no analogy between the provisions held to be incorporated in the Calcutta Improvement Trust Act 1911 dealt with by the Privy Council and section 23A of the Foreign Exchange Regulation Act now under discussion. We bold therefore that when a notification issued under section 8(1) of the Foreign Exchange Regulation Act is deemed for all purposes to be a notification issued under section 19 of the , the contravention of the notification attracts to it each and every Provision of the which is in force at the date of the notification. The other ground upon which the learned Judges upheld the respondent 's contention that the rule as to the burden of proof enunciated in s.178 A was not attracted to the present case was based on the finding that the Customs Officer who effected the seizure did not, at the moment of seizure, entertain a reasonable belief that the goods seized were smuggled. The learned Solicitor General who contested the correctness of this finding did not urge that the words. in section 178A "in the reasonable belief that they are smuggled goods" did not prescribe a condition precedent to the applicability of that provision which had to be satisfied before the provision could be invoked against the affected party. As we have already pointed out, his further submission was that such a reasonable belief must not only be entertained by the seizing officer and besides that the question whether the officer had done so or not, was a matter which could objectively be determined by the adjudicating authority acting under section 182. And these submissions he made, as aids to his main contention that the burden of proof 838 imposed was reasonable. We are pointing this out because before the learned Judges of the High Court the argument apparently advanced was that the test was the subjective belief of the seizing officer which could only be disproved by the establishment of circumstances in which no such belief ,could ever honestly or reasonably be entertained based on the reference to ',the subjectivity of the officer" in the judgment of this Court in Babulal Amthalal Metha vs The Collector of Customs, Calcutta (1). It was by approaching the problem even from this very narrow stand point that the learned Judges reached a conclusion on this part of the case favourable to the respondent. For the decision of this point it is necessary to canvass the facts which occurred at the moment of seizure in some detail. As narrated at the commencement of this Judgment, Nandgopal, the second respondent the employee of the first respondent was intercepted first by the Head Constable of the Madras State Prohibition Intelligence Department and his clothing was searched and the four gold blocks weighing about a thousand tolas were seized by the Head Constable. The Prohibition Crime branch has a Criminal Investigation Department and the seized gold was handed over by the Head Constable to the Inspector of Police Criminal Investigation Department on the same day. It was this Inspector (C. Rajamanickam) that forwarded the gold to the Inspector of Customs (Special Division) with a letter in these terms "I send herewith 1,000 (One thousand) tolas of gold in 4 (four) blocks seized from G.Nandgopal,Clerk, M/s. Nathella Sampathu Chetty, Madras, No. 177, N. section C. Bose Road. The passenger came from Bombay to Madras in N. Y. Bombay Mail on 26th June 1956, at 6 A. M. He has no records (1) 839 of any kind for the purchase of gold. Hence the gold was seized and he was arrested under a mahazar. The passenger and gold are forwarded for further action under Customs Act. " It would be seen that up to this point there had been no seizure by an officer acting under the within section 178A of the Act. It has also to be noticed that Nandgopal had in his possession admittedly no receipt of any kind for the purchase of the gold ; further he had on him the letter addressed by the first respondent to Mathura das Gopalakrishnayya & Co., Bullion merchants, Bombay intimating that cash to the extent of rupees one lakh was being sent through the representative, which obviously could not possibly remain in the possession of Nandgopal if has story about his taking cash to that addressee and the purchase of the gold from him were true. It was in these circumstances that the Inspector (Special Division) Customs House recorded : "Detained four blocks of gold said to weigh about 1,000 tolas from Shri Nandgopal, representative of Nathella Sampathu Chetty & Sons for further investigation". There are two views possible of the exact import of this note by the Customs Inspector : (1) that it was a ,,,detention" preliminary to a seizure which would be effected after the further investigation, and (2) that which found favour with the learned Judge; of the High Court that it was itself the seizure. In support of the first of the above constructions attention may be drawn to the fact that the events narrated earlier took place before 8 O 'clock in the morning and that immediately thereafter Nandgopal was taken to the Customs House and was examined there at about 8.30 and in the course of his examination he made several statements which were obviously incorrect and whose error was capable of being detected then and there. 840 (1) He stated that the gold had been bought from M/s. Mathuradas Gopalakrishnayya & Co. having paid them the sum of rupees one lakh which was referred to in the letter seized from him, but obviously if the gold had been purchased from that firm the letter could not remain with Nandgopal and this discrepancy he was unable to explain at that stage. , for he said " I cannot account for the presence of this letter on me which should have been given to the firm in Bombay". (2) Nandgopal who spoke to having received gold and then secreted it in the inner side pockets of his waist coat and stitched it stated, that the gold was moosa gold and it was found that the gold seized from him was not that variety. It is really after this statement was recorded at the Customs House that the "investigation" began. It is therefore possible to take the view that the detention resulted in a seizure after the statement was recorded. There was ample material at that stage on the basis of which it could be said that a reasonable belief could be entertained that the gold seized was smuggled. Even taking the record of the detention in the mahazar prepared at the Central station as "the seizure" we do not agree with the learned Judges of the High Court that the seizing officer could not entertain a reasonable belief that the gold seized was smuggled. The reasonableness of the belief has to be judged by all the circumstances appearing at that moment. In the present case, the quantity of gold in the possession of Nandgopal of the value of over one lakh of rupees was certainly a very relevant factor to be taken into account and which could be considered in judging the matter. No doubt, such a quantity could be the subject of bona fide purchase in the course of normal trade, particularly when the person in possession was the representative of a ' well known firm of bullion dealers. Put one 841 would also normally expect that the representative would have secured a bill or voucher to evidence the purchase. In other words: (1) it was not a case of a few trinkets of gold or small quantity purchased for domestic or personal use but a considerable amount for purposes of business, (2) the undelivered letter addressed to M/s. Mathuradas Gopalakrishnayya and Co., which admittedly had a bearing upon the purchase of gold in the possession of Nandgopal necessarily drew an amount of suspicion on the theory of a bona fide purchase. These circumstances, in our opinion, which were admittedly present at the moment when the gold was taken by the Customs Officer at the Central Station did tend to raise a reasonable suspicion that the gold seized had been obtained illicitly and this was sufficient to constitute, in the words of the statute, 1% reasonable belief that the goods (gold) were smuggled". We are therefore of opinion (1) that s.178A was constitutionally valid, (2) that the rule as to the burden of proof enacted by that section applies to a contravention of a notification under section 8(1) of the Foreign Exchange Regulation Act, 1947, by virtue of its being deemed to be a contravention of a notification under section 19 of the , (3) that the preliminary requirement of section 178A that the officer seizing should entertain "a reasonable belief that the goods seized were smuggled" was satisfied in the present case. The result therefore is that the petitions under article 226 of the Constitution filed by the respondent before the High Court should have been dismissed. We accordingly allow appeals 408 and 409 with costs throughout (one set of hearing fees), the writ petitions filed by the respondent being directed to be dismissed. In view of our decision in appeals 408 and 409, the points raised by the respondent in appeal 410 of 1960 do not require to be decided. That appeal fails and is dismissed. There will however, be no order as to costs. 842 Criminal Appeals No. 38 of 1959, No. 126 of 1959, No. 1.23 of 1959, Civil Appeal No. 511 of 1960 and Writ Petition No. 118 of 1958 were not heard on the merits and we have not examined the facts of any of those cases. Those appeals and petitions should, therefore, be posted for hearing in the usual course. Appeals nos. 408 and 409 allowed. Appeal No. 410 dismissed.

Under the powers conferred by section 8(1) of the Foreign Exchange Regulation Act, 1947, the Central Government issued a notification on August 25, 1948, placing a ban on the importation of gold except with the permission of the Reserve Bank. Section 23A of the Act, which was introduced by an amendment in 1952, provided that". the restrictions imposed by section 8(1). shall be deemed to have been imposed under section 19 of the , and all the provisions of the Act shall have effect accordingly. " Section 19 of the , enabled the Central Government, by notification, to prohibit or restrict the bringing goods of any specified description into 787 India and, by reason of other :provisions of that Act, goods imported in contravention of the notification issued under section 19 were liable to confiscation. In 1955, the , was amended by the introduction of section 178A in that Act, which provided, inter alia that "where goods were seized, under that Act in the reasonable belief that they were smuggled goods, the burden of proving that they were not smuggled goods shall be on the person from whose possession the goods were seized. " On June 26, 1956, N, an employee of the respondent, on alighting at the Central Station in Madras From Bombay was intercepted by a Police Head Constable and, on a search of his clothing, four blocks of gold weighing about a thousand tolas were found in his possession. The officers of the customs department interrogated him and, finding that lie was unable to produce any record for the purchase of the gold, seized from him the blocks of gold. N admitted that he brought the gold for the respondent and enquiries were made to verify the story narrated by him as to the source from which he obtained the gold. Thereafter the Collector of Customs being prima facie of the view that the gold seized had been smuggled, issued notice to the respondent to show cause why the said gold should not be confiscated. The respondent offered his explanation bat the Collector held that the respondent bad not discharged the onus of proving that the gold was not smuggled, an onus which had been cast on him by section 178A of the , and directed the confiscation of the gold under section 167(8) of that Act. The respondent challenged the legality of the action taken by the Collector of Customs on the grounds, inter alia, (1) that section 178A of the Sea Customs Act, 1873, was consti tutionally invalid as it was an unreasonable restraint on the citizen 's rights to hold property or to do business guaranteed by article 19(1)(f) and (g) of the Constitution of India and was not saved by cls. (5) and (6) respectively of article 19; (2) that section 178A of the Sea Customs Act which was enacted in 1955 could not be invoked in adjudicating a contravention of a notification under the Foreign Exchange Regulation Act inasmuch as section 23A of the latter Act when enacted in 1952 in effect incorporated into that Act all the relevant provisions of the Sea Customs Act as they stood in ' 1952 with the result that any subsequent amendments to the Sea Customs Act could not affect section 23A; and (3) that the rule as to the burden of proof under section 178A was not attracted to the present case because the Customs Officer who effected the seizure did not, at the moment of seizure, entertain a reasonable belief that the goods seized were smuggled. The Collector of Customs besides maintaining the legality of the order of confiscation, contended that the question raised in the case as to the constitutional 788 validity of section 178A of the Sea Customs Act was concluded by the decision in Babulal Amthalal Mehta vs The Collector of Customs, Calcutta Held: (1) that Babulal Amthalal Mehta vs The Collector of Customs, Calcutta, [1957] section C. R. II 10, was a decision as to the validity of section 178A of the Customs Act, 1878, with reference to article 14 of the Constitution of India only and that the question whether the said section was obnoxious to the rights guaranteed by article 19(1)(f) and (g) was not considered by that judgment. (2) that the object of section 178A was the prevention and eradication of smuggling, inter alia of gold which was widely prevalent, and in view of the fact that without a Law in that form and with that amplitude smuggling might not be possible of being effectively checked, the restrictions imposed by that section being in the interests of the general public could not be held to be violative of the rights guaranteed by article 19 (1) (f) and (g), though it might operate somewhat harshly on a small section of the public. Accordingly, section 178A does not contravene article 19(1)(f) and (g). State of Madras vs V. G. Row, ; , Manohar Lal vs State of Punjab, ; and Ram Dhan Dass vs State of Punjab; , , relied on. Pukhraj Champalal Jain vs D. R. Kohli, (1959) 61 Bom. T. R. 1230, approved. M.G. Abrol vs Amichand, (1 960) , disapproved. Nathella Sampathu Chetty vs Collector of Customs, Madras, A. 1. R. , reversed. (3) that a seizure to which section 178A was applicable was merely a preliminary to the proceedings before a quasi judicial authority under section 182 and that it was only when the latter authority was, satisfied that the seizure was made "in the reasonable belief that the goods seized were goods that had been smuggled" that the rule of evidence laid down by section 178A came into operation. (4) that the wording of section 23A of the Foreign Exchange Regulation Act, 1947, showed that the reference in it to section 19 of the , was merely for rendering notifications under the named provisions of the Foreign Exchange Regulation Act to operate as notifications under the and that it could not have the effect of incorporating the relevant provisions of the latter Act in the Act of 1947, and that, consequently, when a notification issued under section 8(1) of the Foreign Exchange Regulation Act was deemed for ail purposes to be a notification issued under section 19 of the 789 , the contravention of the notification attracted to it each and every provision of the which was in force at the date of the notification. The, Secretary of State for India in Council vs Hindustan Co operative Insurance Society Ltd., (1931) L. R,. A. 259, held inapplicable. (5) that, in the instant case, the circumstances present at the moment when the gold was taken by the Customs Officer at the Central Station did tend to raise a reasonable suspicion that the gold seized had been obtained illicitly and that this was sufficient to constitute in the words of the statute "a reasonable belief that the goods (gold) were smuggled."

Appeal No. 424 of 1958. Appeal from the judgment and decree dated April 25, 1950, of the Madras High Court in A. section No. 67 of 1947. K. Bhimasankaram and. K.R. Chaudhuri. for the appellants. T. V. R. Tatachari, for respondents Nos. 1 to 3. P. Ram Reddy, for respondent No. 9. M. R. Krishna Pillai for respondent No. 24. September 18. The Judgment of the Court was delivered by SHAH J. One Thammiah had two sons Gangaraju and Ramayya and four daughters Ammanna, Sesbamma, Gangamma and Bbavamma, of these, the two sons and the daughter Ammanna .died during Thammiab 's life time. Gangaraju left him surviving his widow Cbetamma and Ramayya his widow Venkamma. Ammanna was survived by her son Rudrayya, who was brought up by Thammiah. Thammiah died in 1885, Seshamma in 1904, Gangamma in 1930 and Bhavamma in 1935. After the death of Bhavamma, Paddaraju (herein after called the plaintiff), son ' of Gangamma filed Suit No. 53 of 1944 in the court of the Subordinate 655 Judge at Rajamundhry against the descendants of Seshamma and Ammanna for a decree for partition and separate possession of a third share in 17 lands, described in Schedule B to the plaint as "agricultural land and measuring in the aggregate 51 acres 72 cents in Patta No. 12 in village Pandalpaka in Pitbapur Zamindari" and in Schedule IC ' described as three houses with sites thereof in village Pandalpaka,. To this suit Jaggarayudu and Paddaraju, sons of Venkataraju brother of the plaintiff were impleaded as defendants 31 and 32. The plaintiff claimed that Thammiah owned occupancy rights in the ryoti lands in the Pithapuram Zamindari and that after Thammiab 's death the lands were managed with the permission of the plaintiff and his brother Venkataraju, in the first instance, by the two daughters in law of Thammiah Chetamma and Rammanna, son of Seshamma and their "possession and management was on behalf of heirs and persons entitled to maintenance out of the estate" and that the right to sue for ' partition accrued on the death of Bhavamma on March 18, 1935. The suit was resisted by the descendants of Seshamma and Annamma principally on the plea that in the lands described in Schedule "B 'Thammiah had not proprietary right and that occupancy right therein accrued to Rudrayya and Veeriah (husband of Seshamma) by virtue of the Madras Estates Lands Act, 1908. It was also pleaded that Thammiah had made an oral will devising his estate in favour of Veeriah who was his illatom son in law and Rudrayya in equal shares. This plea about the oral will was negatived by the Court of First Instance and, the High Court and need no longer be consi dered, because it is not canvassed be fore us in this appeal. The trial Court held that Thammiah had no proprietary interest in the lands in Schedule 'B ' and on that view decreed the plaintiff 's claim for partition of the houses and sites described in Schedule IC ' only and awarded a third share to him, 656 another third share to Ramanna and the remaining third share collectively to defendants 31 and 32sons of Venkataraju. in appeal, the High Court of Madras modified the decree of the trial court holding that in the agricultural lands Thammiah had occupancy rights which on his death devolved on his surviving daughters, and directed that those lands be also partitioned, and that a third share be awarded to the plaintiff and a third share to defendants 31 and 32 together with mesne profits from March 18,1935. the date of Bhavammas death. With certificate under article 133, this appeal is preferred by the descendants of Seshamma and Ammanna. The principal question which falls to be determined in this appeal is whether Thammiah had, as claimed by the plaintiff, occupancy rights in the lands described in Schedule 'B ', or as the contesting defendants contend, Thammiah was an annual tenant of the zamindar and that after his death the lands were held on similar tenure by different members of the family of Thammiah and that the occupancy right was acquired by Rudrayya and Veeriah by virtue of the Madras Estates Lands Act, 1908. The lands are within a permanently settled zamindari under Madras Regulation XXV of 1802, and it is common ground that Thammiah was cultivating the entire area of the lands during his life time. There is no evidence indicating that his possession was ever disturbed during his life time. There is again no evidence about the commencement of the occupation of Thammiah or his pre decessors : commencement of their occupation is therefore lost in antiquity. The lands are described in the various documents, to which we will presently refer, as "jeeroyati landie ' Thammiah as "jeeroyati ryot", and after his death his daughters in law and grandson Ramanna were similarly described. Three documents Exts. D 1, D 2 and D 3which establish that Thammiah was cultivating the lands throw important light on the problem under 657 discussion. Exhibit D 1 is a muchilika dated July St 1, 1883, executed by Thammiah in favour of the zamindar. Exhibits D 2 and D 3 are similar muchilikas dated respectively August 10, 1884, and July 15 1885. Each of these muchilikas is in respect of the seventeen pieces of lands described in Schedule "B ' and the 'cist ' settled is Rs. 419/8/ . The terms of the three muchilikas are identical. Thammiah is described in the muchilikas as "jeeroyati ryot" and the lands are described as "jeeroyati pampus". It is recited in the muchilikas "I have executed and delivered this muchilika agreeing that I should pay the said cist amount of Rs. 419/8/every fasli according to the instalments mentioned hereunder to the Officials on your behalf and to obtain receipts;. . . that during the last year of the term, I should not raise gingelly or chiruyeru crop on these pampus but that I should leave sufficient land for purposes of garden cultivation and seed beds; that I should not cut down any, kind of trees without your permission; that I should not raise permanent gardens or construct houses on these lands without your permission; that I should not cause damage to these lands so as to make them unfit for cultivation purposes; that if at the of the term you should lease out these pampus to anyone, whom you like, for a cist amount advantageous to you, I should not raise objection thereto; that if you had leased out these lands to other ryots for the ensuing year after the expiry of the term, and if 'the said ryots should carry on necessary works for purposes of cultivation during the ensuing year by way of ploughing seed beds, sowing seeds and planting tender sugarcane even before the expiry of this term, I should leave sufficient land to them without raising any objection whatsoever. " By the covenants of the muchilikas Thammiah had undoubtedly undertaken not to raise certain crops, nor to cut trees, nor to put up permanent constructions and had also undertaken to give certain facilities to other tenants 658 inducted in the lands by the zamindar. The evidence does not justify the inference that Thammiah was inducted on the land by Ext. There is even no evidence that the land was acquired from the, zaminder by the members of Thammiab 's family or that the ancestors of Thammiah were not on the land before the zamindari rights accrued to the zamindar. It is also not didputed that land 1, in zamindaries in the Madras Presidency were even held in occupancy right by many ryots before the Madras EstateB Lands Act, 1908, was enacted. As observed in Venkata Narasimha Naidu vs Dandamudi Kotayyo(1) at 301 that "there is absolutely no ground for laying down that the rights of ryots in zamindaries invariably or even generally had their origin in express or implied grants made by the zamindar. The view that in the large majority of instances, it originated otherwise is the one most in accord with the history of agricultural land holding in this country. For, in the first place, sovereigns, ancient or modern, did not here set up more than a right to a share of the produce raised by raiyats in lands cultivated by them, however much that share varied at different. times. And, in the language of the Board of Revenue which long after the Permanent Settlement Regulations were passed, investigated and reported upon the nature of the rights of ryots in the various parts of the Presidency, "whether rendered in service, in money or in kind and whether paid to rajas, jagirdars, zamindars, poligars, mutadars, shrotiemdars, inamdars or to Government officers, such as tehaildars, amildars, amins or thannadars, the payments which have always been made are universally deemed the due of Government. . Therefore to treat such a payment by cultivators to zamindars as 'rent ' in the strict sense of the term and to imply therefrom the relation of landlord and tenant so as to let in the presumption of law that a tenancy in general is one from year to year, would be to introduce (1) Mad.a 299. 659 a mischievous fiction destructive of the rights of great numbers of the cultivating classes in this province who have held possession of their lands for generations and generations. " It was also observed in that case (at p. 303), ",It thus seem unquestionable that prima facie a zamindar and a raiyat are holders of the melvaram and kudivaram rights, respectively. When, therefore, the former sues to eject the latter, it is difficult to see why the defendant in such a case should be treated otherwise than defendants in possession are generally treated, by being called upon, in the first instance, to prove that they have a right to continue in possessions The right to occupy land under the revenue system prevailing in Madras may arise by reason of the customs in the district in which they are situate. In any event, there is no presumption that the holder of the land under a Zamindar is a tenant at will. In each case the rights of the ryot have to be ascertained in the light of the facts proved. In Appa Rau vs Subbanna (1), Muttusami Ayyar and Wilkinson, JJ., were called upon to consider whether a zamindari ryot could mortgage his interest in his holding. It was observed in that case that " 'According to the course of decisions, therefore, in this presidency the landlord may determine the tenancy if there is a contract, express or implied, by exercising his will in accordance with his obligations; that there is no presumption in favour of a tenancy at will; that an occupancy right may exist by customs; that a pattadar or raiyat in a mitta is entitled to continue in possession so long as he regularly pays rent 'and has a saleable interest, and that by reason of special circumstances in evidence the onus of proof may be shifted, even in regard to a permanent occupancy right, from the tenant to the landlord. " The court also observed that it would be ,,monstrous to hold that every tenant in a zamindari is presumably a tenant at will". (1) (1889) 1. L. R. 660 In Vencata Mahalakshmamma vs Ramajogi (1), a zamindar served a notice upon the defendant, who was a cultivating ryot in the zamindari calling upon him to deliver possession of his holding, and on default of compliance sued to evict him from his holding. The defendant pleaded that he and his ancestors had been "jiroyati ryots" of the holding from times immemorial. According to the High Court, the zamindar having failed to prove that the ryot 's tenancy had commenced under the zamindar or his ancestors, the suit should be dismissed. The court observed that "in cases. in which the raiyats ' holding is not shown to have commenced subsequent to the permanent settlement, and when upon the evidence, it is possibly as ancient as the zamindari itself, the principle laid down with reference to tenancies which admittedly commenced under the zamindar" had no application, and that "in such cases it is not unreasonable to hold that the onus of showing that the tenancy commenced under the plaintiff or his ancestors rests on the zamindar, and that until he shows it, the zamindar may be fairly presumed to have been the assignee of Government revenue, and the tenant liable to pay a fair rent and entitled to continue in possession as long as be regularly pays rent. In Yenkata Narasimha Naidu vs Dandamudi Kotayya(2), which we have already referred, it was held that a ryot in a permanently settled estate is prima facie not a mere tenant from year to year but the owner 1 of the kudivaram right in the land he cultivates, and in a suit in ejectment, the zamindar "is to prove that the kudivaram right in the disputed land subsequently passed to the defendant or some person through whom he claims under circumstances which give the plaintiff the right to eject. " The Court observed that there is no substantial analogy between an, English tenant and an Indian ryot for the right of ryots came into existence ' (2) Mad. 661 mostly, not under any letting by the Government of the day or its assignees, the zamindars, but independently of them, according to the Indian: traditions such right were generally acquired by, cultivators entering upon land, improving it and. making it productive. After referring to the judgment of Turner, C. J., and Muttusami Ayyar, J., in Siva Subramanya vs The Secretary of State for India(1), that the Hindu jurisprudence rested private property, on occupation as owner, and to Secretary of State vs Vira Rayan(2) that the right to the possession of lands acquired by the first person who makes a beneficial use of the soil, it was observed that the well known division in the, Madras Presidency of the great interests in land under two main beads of the melvaram interest and the kudivaram interest made the holder of the kudivaram right, far from being a tenant of the holder of the melvaram right, a co owner with him. In Cheekati Zamindar vs Banasooru Dhora and others(3), Shephard, J., observed at p. 322, "Many of the occupants of zamindari lands are not tenants in the proper sense of the word, and the fair presumption is that, when new occupants are admitted to the enjoyment of waste or abandoned lands, the intention is that they should enjoy on the same terms as those under which the prior occupants of zamindari lands held. It is open to the zamindar to rebut the presumption. He may show as was shown in Achayya vs Hanumantrayudu (4) that the usual condition of things does not prevail in his estate or he may adduce evidence as to the particular contract made between him and his tenant. In other words, he may show that the terms of the contract were different from those which ordinarily prevail between a zamindar and the occupant of zamindari lands. " Subrahmania Ayyar, J. observed, "Practically the whole of the agricultural land there (1) mad. (2) Mad. (3) (1899) 1. L. R. (4) (1891) 1. L. R. 662 is not cultivated by persons who merely hire it for a limited time. The raiyats most generally hold by no derivative tenure. And even where the right to cultivate passes to them from zamindars the payment made by them, in the absence of a contract, is regulated by custom in the last resort, as provided in section 11 of the Rent Recovery Act. The raiyats are generally entitled to hold the lands for a unlimited time, that if; as long as they wish to retain it subject to the performance of the obligations incident to the tenure. Nor can it be said that this is true only in regard to so much of the land in the hands of the raiyats as cannot be shown to have been obtained by them from zamindars. For in the case of lands which have been relinquished by the former occupants or which have been lying waste from time immemorial, they too, when taken up by a raiyat, are treated exactly on the same footing as land into the possession of which it is not shown that the raiyat was let in by a zamindar, and the raiyat holds possession of them for an indefinite period". In Kumbham Lakshmanna and others. vs Tanjirala Venkateswarlu and Others (1), the Judicial Committee of the Privy Council held that in a suit to eject the tenant of an inamdar from his holding the burden is on the plaintiff to make out a right to evict by proving that the grant included both the melvaram and the kudivaram interests, or that the tenants or their predecessors were let into possession by the inamdar under a terminable lease. The dispute in that case was between inamdars and a tenant and had to be decided by the Civil Court, for having regard to the definition in a. 3(2) (d) of the Madras; Estates Land Act, 1908, the Act did not apply to inamdars. By section 6 of the Act it having been provided that ",every ryot now in possession or who shall hereafter be admitted by a landholder to possession of ryoti land situated in the estate of such landholder shall have a permanent right of occupancy in his holding," (1) (1949) L. It. 76 T. A. '202. 663 all tenants in possession of land at the date on which the Act came into operation, were declared to be holders of permanent occupancy rights, but the Act did not justify the inference that the holders prior to that date did not and could not hold occupancy rights. The Privy Council was of the view that in any action by an inamdar to evict his tenants and by a zamindar prior to 1908 to evict his raiyats from their holdings, the burden was on the plaintiff to make out the right to evict by proving that the grant included both the melvaram and the kudivaram interests or that the holders of land or their predecessors were let into possession by the inamdar or the zamindar under a terminable lease. The Privy Council judgment, therefore, recorded its approval to the view expressed in the earlier cases to which we have referred. But counsel for the respondents contended that this was not a suit between a zamindar and a ryot and the rule as to the onus of proof in a suit as between a zamindar and a ryot did not apply where the suit was filed by a person like the plaintiff claiming a share in the occupancy right in land in possession of the defendants, and unless the plaintiff establishes affirmatively that the common ancestor was before 1908 in possession as an occupancy tenant, his suit must fail. We do not think that this is a permissible approach. The presumption which arises in a suit by a zamindar against a ryot for possession of the letter 's holding, rests not on the narrow ground of burden that whoever alleges title and claims relief on that footing must establish it ; the presumption has its roots in the system of land tenure and in custom of the area in which the lands are situate, and applies in a suit between persons claiming under the ryot, as well as in a suit against the ryot by the zamindar. Counsel for the respondent relied upon certain circumstances which appeared from the evidence 664 as lending support to the plea of the contesting defendants that the lands were not held by Thammiah in occupancy right. Reliance was placed upon the covenant in Exts. D 1, D 2 and D 3 that the zamindar may on the expiry of the year of the muchilika, let out the lands to any tenant at "cist" advantageous to the, zamindar. It is true that in Exts. D 1, D 2 and D 3 it is recited that if at the end of the terms of the muchilika the zamindar should lease out the land to any one for a "cist" advantageous to hina, Thammiah would not object thereto, and he further agreed that he would leave sufficient land, without raising any objection, for the ryot to carry out the necessary work for cultivation during the ensuring year. But such a covenant is by itself not sufficient to justify the inference that the ryot 's tenure was precarious. It appears that since the decision of the Madras High Court in Chockaling Pilli vs Vythealinga Pundara Sunnady (1) that neither the rent Recovery Act, nor the regulations operated to extend a tenancy beyond the period secured by the express or implied terms of the contract creating it, the zamindars were accustomed to take muchilika or other writings from their ryots admitting notwithstanding the true nature of their rights, that their tenure was restricted or precarious. In Vencata Mahalakshmamma vs Ramajogi (2), in dealing with a muchilika executed by a ryot for a period of one year only, Muttusami Ayyar J., observed, "Neither a patta nor a muchalka granted or executed under Act VIII of 1865 during the continuance of the holding is conclusive evidence that the holding is a tenancy from year to year. A patta or muchalka is ordinarily nothing more than a record of what the tenant has to pay for a particular year with reference to the pre existing relation of landlord and tenant. The fact cannot also be lost sight of that the zamindar is always a man of education, status and influence and often exercises (1) (2) (1892) 1. L. R. 665 revenue power and control over the village records. On the other hand, the raiyats are illiterate persons and it would be easy enough to get them sign anything as long as there is no attempt to interfere with their actual occupation and enjoyment of the land.". It would be unreasonable, therefore, to attach any undue important to the recitals of the, nature contained in Exts. D 1, D 2 and D 3. The Privy Council in Kumbham Lakshmamma 's case referred to the practice among zamindars of taking muchilikas from ryots negativing the existence of the occupancy rights as being prevalent and to the judicial recognition of such a practice in Peravali Kotayya V. Pnnopalli Ramakrishnayya (2) and Zamindar of Chella palli vs Rajalapati Somayya (3). The Judicial Committee referred with approval to the observations of Wallis, C.J., in the latter case to the effect : "In this connection it is to be borne in mind that numerous instances have come before the courts in which subsequent to the decision of in inserting in pattas and muchilikas terms negativing the existence of occupancy right". and pointed out that they could not neglect the consideration that a ryot so long as he is not evicted, might be prepared to sign anything and that the evidential value of such a contract should be judged accordingly. It is true that if there were some reliable or substantial evidence to show that the tenancy had commenced after the zamindari rights accrued or that 'otherwise the tenant 's right was restricted, the value to be attached to the reci tals of 'the nature set out may be greater ; but there are no circumstances in this case lending strength to the recitals contained in Exts. D 1, D 2 and D.3. After the death of Thammiah, muchilikas were obtained 'and pattas granted by the zamindar not in favour of the daughters ' of Thammiab, who were under the Hindu Law his heirs, but in favour (1) (1949) L. R. 76 I. A. 202. (2) (4) 666 of his daughters in law, in the first instance, and thereafter, in favour of one of the daughters in law and Ramanna, grandson of Thammiah. These documents are Exts. D 4, D 5, D 5 (a), D 6 and D 8. Ext 1 @ 4 is a muchilika executed on August 15, 1891 by Venkamma and Chetamma, daughters inlaw of Thammiah. D 5 is another ' muchilika executed on August,, 15, 1893 by Venkamma and Chetamma. Each of these muchilikas is for period of one year. D 5 (a) is a patta executed on October 10, 1893 by the zamindar corresponding to muchilika Ext. exhibit D 6 is a patta executed on May 21, 1904, by the zamindar in favour of Chetemma and Ramanna minor by his guardian Veeriah and there% is Ext. D 8 which is a patta dated January 16, 1906 also in favour of Chetamma and Ramanna. All these muchilikas and pattas related to the same seventeen pieces of land which were originally in the possession of Thammiah, and the covenants thereof are identical. It is true that in respect of the first two inuchilikas the ryots were Chetamma. and Venkamma, and in Exta. D 6 and D 8; the ryots were Chetamma and Ramanna. Counsel for the defendants asks us to infer from Exts. D 4 to D 8 that the zamindar had at the end of the year for which the muchilikas or pattas were executed exercised his right of eviction and had taken possession of the lands and had given them to other persons of his own choice. But it is difficult to draw that inference in the absence of any reliable evidence that the zamindar had evicted ryots who had executed the muchilikas and had then inducted fresh ryots on the land. The reason why Venkamma was omitted after 1893 from the muchilikas and pattas of the land and in her place Ramanna was substituted will be presently mentioned. After the death of Thammiah, his rights in the land would undoubtedly devolve by the law of inheritance upon his surviving daughters with limited interest. But the fact that muchilikas were taken from persons who were strictly not heirs according to Hindu law, but were still 667 representatives of the family, will not justify an inference that the right of the original ryots were extinguished and fresh rights in favour of persons who executed muchilikas were created. The two daughters in law Chetamma and Venkamma after the death of Thammiah, continued to live in the. family house together with Sesharama. Veerayya and Rudriah, and it is not unlikely that the zamindar regarded the two daughters in Law as representatives of the family and took muchilikas from them. there is no warrant for the inference that they were inducted on the land in independent right by the zamindar arid not as representatives of the descendants of Thammiah. The learned Judges of the High Court observed that "in 1895 (when Ext. D 4 was executed) in country parts like Pandalpaka, it is too much to assume such a second knowledge of Hindu law. Besides, Venkamma and Chetamma were, admittedly, living a,long with Veerliah and Rudrayya and Ramanna and Bhavamma during Thammiah 's life time, and continued to live in that some 'house after his death . So, we have no doubt that the Maharaja of Pittapur, the zamindar, never intended.in the least to take away the B Schedule lands from Tammayya 's heirs and given them to Venkamma and Chittemma who were not heirs and we hold that he renewed the patta in favour of these two windows, as they were considered by him to be representing Tammayya 's estate, being his widowed daughters in law. our view, this in the circumstances of the case, is a correct inference. It appears that after 1895 there arose disputes between Veeriah and Venkamma and it was arranged to provide maintenance to Venkamma out of the estate of Thammiab. , Ext. P 1 dated May 16, 1.899 records the terms on which maintenance was granted. This document has a very importal Lt bearing on the question which falls to be decided in this appeal. 1 b is received [email protected] E2:t. P 1 that all the properties of Thammiah had, devolved,, after 668 his death, upon his "dowbitras" (daughter 's sons), Rudriah and Ramanna and that the two "dowhitras" were bound to maintain the widowed daughters in law Chetamma and Venkamma and that accordingly they. were being ' maintained, but a Venkamma was unwilling to live in the family house, it. Was decided to give her for maintenance expenses Rs.25 and 240 kunchams of white paddy per year besides a house, for residence. This deed recites that out of the estate of Thammiah the two widows Chetamma and Venkamma were in fact being maintained that the estate was inherite I by Rudriah and Ramanna, and recognises the right of the widows to receive maintenance out of the estate. There is no evidence on the record that besides the lands mentioned in Schedule 'B ' there was any other agricultural land of which Thammiah was possessed and which had devolved upon Rudriah and Ramanna. It is admittedly out of the property of Thammiah which had devolved upon Rudriah and Ramanna that maintenance was agreed to be given, and if Thammiah was not possessed of any property other than the lands in Schedule "B ', Ext. P 1 must lend strong support to the inference that the lands in Schedule 'B ' were regarded at the date of the maintenance deed as belonging to the estate of Thammiah out of which Venkamma was entitled to maintenance. The assumption that the property had, devolved upon Rudriah and Ramanna is evidently not true. long as the daughters or any of them were alive, they were, according to the Hindu law applicable to the Madras Presidency, owners, though for their lifetime only, of the estate left,. by Thammiah. P 1 does therefore land support to the case of the plaintiff that the property was regarded as belonging to the family in which all persons who were living in the house of Thammiah, including the two daughters in law., had;, interest. After. maintenance was provided to Venkamma by Ext. P 1 her name was omitted from the muchilikas and the pattas subsequently Pattas D 6 and 669 D 8 are as we 'have already stated, 'in favour of Chetamma and Ramanna. It is true that rent was enhanced by the zamindar from time to. time under the muchilikas. During the life time of Thammiah the annual rent was Rs. 419 8 0 and it .remained unchanged, but after his death the rent, even though the area 0f the land continued to be ' the same, was enhanced to Rs. 481 8 0 under Ext. There is some error in totaling tip the amount of rent,, but the enhancement of rent by Rs. 52 is substantially the result of alteration of rent of Sr. No. 315. Originally the rent of Sr. No. 315 was Rs. 29 3 9: it was enhanced to Rs. 81 3 9. under Ext. D 5 the rent is Rs 537 (it should have, been Rs. 473), but that again, is the result of some error in totaling, the only enhancement being in respect of No. 358 which was increased from Rs. 5 to Rs. 6 8 0. 'In Ext, D 6 of the year 1904 the rent of this land was enhanced to Rs. 60 8 0 and rent in respect of, Sr. No. '315 was enhanced to Rs. 91 3 9. The High Court has held that this enhancement of rent of the two lands Nos. 315 and 358 was presumably because the lands were irrigated, and, having regard to the circum stances, we think the inference of the High Court is correct. Enhancement of rent of the lands from time to time does not lend support to the inference that fresh pattas and muchilikas were not in recognition of the previous rights. It is, pertinent to note that in the records of the zamindar all the muchilikas in respect of the lands bore No. 12, during the life time of Thammiah and after his death they bore No. 23. The circumstance that the same area of land remained in the occupation continuously of the family of Thammiah under Exts. D 1 to D 8 for a period exceeding 25 years also lends support to the plea of the plaintiff. It is true that by his notice Ext. D 7 the zamindar called upon Ramanna and Chetamma to vacate. the kumatam (which term is translated by the learned counsel for the respondent as home farm) lands of the extent of 51 acres 72 cents. But by the year 670 1905 it was well known that legislation of the nature,which was ultimately enacted as the Madras Estate Land Act, 1908, was on the legislative anvil and no reliance can be placed upon the statements made in the notice which does 'not appear to have been followed by proceedings, for enforcement of the claim to possession. It is common wound that on January 16, 1906, the zamindar issued in favour of Chetamma and Ramanna a patta in respect of the same lands.for an annual rental of Rs. 578 4 0, rent having been enhanced in respect of Sr. No. 46 and 358 only. The High Court placed strong reliance upon the circumstances that in all the muchilikas and pattas the lands were described as "jeroyati lands" and the tenants were described as "joroyati ryots". The High Court observed that "jeroyati ryot" was a well known term indicating prima: facie posses sion of occupancy rights. However, the state of the authorities in the Madras High Court to which cur attention his been invited does not justify as in expressing any definite opinion on that plea. In Zamindars of Bodokimidy vs Badankayala Bhimayya(1), Curgenven, J. held that the phrase "on jirayati tenure ' is only used where occupancy rights exist. But beyond the bare statement in the judgment that "the phrases" on jirayati tenure being so far as my experience goes, only used where occupancy rights exist", there is no further elaboration in the judgment. In (Ivaturi) Lingayya Ayyavaru vs Kandula Guningiah (2), Wallace, J., without referring to the earlier judgment of Curgenven, J., observed that the term "jeroyatidar" did not imply that; the executant was an occupancy ryot. Here also no reasons appear to have been given in support of the view. In Dadamudy Tatayya vs Kelachina Venkatasubbarayya Sastri (3), Devadoss, J., in the course of hearing in appeal called for a finding from the (1) A.I.R 927 Mad. (2) A.I.R. 1928 Mad. 58. (3) A.I.R. 1928 Mad. 671 trial Court as to the meaning of the word jeroyati" as used in the Vuyyur Zamindari and as to the meaning of the expression "savaram jeroyiti" used in documents in that estate. The Subordinate Judge recorded evidence on the question referred to him, and observed after referring to Brown 's Dictionary and Wilson 's Glossary, that the word " 'jeroyiti land" may mean "cultivable or arable land", but it was only the context that must decide which meaning was to be given to the word. He also observed that the word " 'jeroyiti" especially when prefixed to the word " 'right" or hakku had come to mean "rights of occupancy". This report of the Subordinate Judge, it appears, was accepted by the High Court. These are the only decisions of the Madras High Court to which our attention was invited. The task of this Court, in ascertaining the special meaning which an expression used in the revenue administration and by the residents of a certain area has acquired, is indeed difficult. If the expression "jeerayot" is a local variation of "Zeerait" used in the revenue administration, especially in Northern India, it may mean " assessed" land, or "agricultural" land. On the material.% placed, we are unable to express any definite opinion on this part of the ease of the plaintiff. To summarise, there is no evidence to show that occupation of the lands by Thammiah commenced under the zamindar ; and there is no evidence as to the terms on which Thammiah or his predecessors were inducted on the lands: the commence ment of the tenancy and the terms there of are lost in antiquity, but Thammiah and his descendants are proved to have continued in possession of land uninterruptedly till the enactment of the Madras Estates Land Act, 1908. In the light of the presumption that the zamindar is, unless the contrary is proved, the owner of the melvaram and the ryot the owner of the kudivaram the inference is irresistible that Thammiah was the holder of the 672 occupany rights in the lands and that these rights devolved 'upon,. his successors and that the, occupancy rights in the lands were not acquired by virtue of the provisions of Madras Act 1 of 1908. Before parting with the case a minor question relating to mesne profits awarded to the plaintiff ,and defendants 31 and 32 must be mentioned. By his plaint the plaintiff claimed mesne profits in respect of his share for three years prior to the date of the suit. He valued the claim for mesne profits at Rs. 3,800 past profits on plaintiffs 1/3rd share for two years 1940 and 1941 at Rs. 2,280 and past mesne profits on plaintiff 's 1/3rd shares for the year 1942 at Rs.1,520. The trial court dismissed the plaintiff 's suit as to his share in property described in Schedule 'B '. The High Court in awarding a third share to the plaintiff and another third share to defendants 31 and 32 collectively also awarded past mesne profits from the 18th of March, 1935, i.e., the date of the death of Bhavamma, alone with future mesne profits regarding the shares in the B and the C Schedules properties. But the High Court could not award mesne profits prior to August, 1940 which had never been claimed by the plaintiff in the suit. We therefore modify the decree of the High Court and direct that mesne profits 1940. Subject to that modification the decree passed by the High Court is affirmed and the Appeal is dismissed with costs payable by the contesting defendants to the plaintiff. Appeal dismissed subject to modification.

The lands in question which were within the permanently settled Zamindari in the then presidency of Madras, belonged to T who, during his lifetime, was cultivating the lands. He died in 1885 leaving behind, inter alia, three daughters. After the death of the three daughters, the last having died in 1935, the sons of one of them instituted a suit against the descendants of the other two for partition and separate possession of a third share, inter alia in the lands in question on the footing that T owned occupancy rights in the lands. The suit was resisted on the plea that T had, no proprietary right in the lands, that he was only an annual tenant of the Zamindar, that after his death the lands were held on similar tenure by different members by his family and that occupancy rights were acquired by those members of his family who were in possession of the lands when the Madras Estates Land Act, 1908, came into force in 1908. There was no evidence to show that the occupation of the lands by T commenced under the Zamindar, nor was there any evidence as to the terms on which he or his predecessors were inducted on the lands, the commencement of the tenancy and the terms thereof being lost in antiquity, but he and his descendants were proved to have continued in possession of the lands uninterruptedly till the enactment of the Madras Estates Land Act, 1908. Held, that in cases in which a ryot 's holding is not shown to have commenced subsequent to the permanent settlement, the presumption is that Zamindar was only the holder 654 of the melvaram being the assignee of the Government revenue, and that the kudivaram in the land belonged to the ryot who Was entitled to continue in possession as long as he paid the rent regularly; and that this principle was applicable equally in a Suit between persons claiming under the ryot as in a suit against the ryot by the Zamindar. Case law relating to the rights of ryots in Zamindaries in the Madras Presidency reviewed. Held, further, that T was the holder of the occupancy rights in the lands, , that these rights devolved upon his successors and that the said occupancy rights were not acquired by virtue of the provisions of the Madras Estates Land Act, 1908.

Appeal No. 324 of 61. Appeal by special leave from the judgment and decree dated December 23, 1960, of the Mysore High Court in Second Appeal No. 61 of 1954. C. K. Daphtary, Solicitor General of India, J. B. Dadachanji, Ravinder Narain and O. C. Mathur, for the appellants. R. Ganapathy Iyer and G. Gopalakrishnan, for the Respondent No. 1. 878 1961. September 27. The Judgment of the Court was delivered by SINHA, C. J. This appeal by special leave granted by this Court on April 20, 1961, is directed against the concurrent decisions of the courts below decreeing the plaintiff 's suit for ejectment on the ground that the defendant is a tenant at will and negativing the appellants ' claim to a permanent tenancy. The controversy between the parties depends upon the true construction of the lease dated October 26, 1914, executed between the predecessors in interest of the parties to the present litigation. The facts leading up to this appeal are as follows: One N. J. Gamodia of Bombay took on lease a piece of agricultural land measuring about 4 1/2 acres belonging to one Gurupadappa of Devangere City for the purpose of erecting a Ginning and Pressing Cotton Factory. The terms of the registered lease deed dated October 26, 1914, in so far as they are material for the determination of this appeal are better stated in the relevant portions of the deed itself: "1. For the 1st period of 20 (twenty) years commencing from the 1st October, 1914, and ending on the 30th day of September, 1934, you shall pay to me Rs. 350/ (three hundred and fifty) rupees being the annual rent reserved every year in advance and obtain proper receipts of the payment from me. If before the expiration of the said period of 20 (twenty) years you will remove your factory from the said land hereby leased you are bound to pay me annually the rent of Rs. 350/ (three hundred and fifty rupees) for the (torn) 20 (twenty) years but you are entitled to retain in possession of and, the road till the 30th September, 1934. 876 2. After the expiration of the said period of 20 (twenty) years mentioned in the 1st clause hereby you shall be at liberty to con tinue the lease of the said land and the said road and keep the said land and the said road in your possession as long as you may desire to do. In case of your thus continuing the lease of the said land and the said road you shall pay to me annually the sum of Rs. 400/ (four hundred rupees) as rent of the said land and the said road for 1st ten years beginning from the 1st October ', 1934, and ending on the 30th September, 1944, and after the expiration of the period of ten years the annual rent payable by you for the said land and the said road will be Rs.500/ (five hundred rupees) per annum but you shall always be at full liberty to give up the said land the said road and terminate this lease at any time you may desire so to do after the 1st October, 1934, and the rent payable in respect of the said land and the said road shall cease to be paid by you from the time you may give up the said land and the said road after the 1st October, 1934. But I agree and bind myself not to call upon you at any time to give up the possession of the said land and the said road as long as you may desire to keep the same for your purposes observing the terms of this agreement. 3. . . . . . . . 4. . . . . . . . 5. You are at full liberty to erect, as many buildings, godowns, factories, bungalows and other structures etc. as you may desire on the land hereby leased and to pull down, re erect and make any alterations in the same as you may desire. I shall not raise any objection to your erecting any such structures on the, land or to your use, and enjoyment of 880 the land in any way or for any purpose as you may desire. . . . . . . . 7. I hold myself liable, to pay always the annual assessment of the land hereby leased to Government you shall not be liable for such land assessment. But you shall be liable 'to pay all fines and other taxes which the Government will hereafter impose for having converted the parable 'or cultivable land into land for factories and building purposes. . . . . . . . . 9. . . . . . . 10. You shall be always entitled and have full liberty to sublet or re let the said land together with the said road for any purpose to any other person or persons on any conditions you like but without effecting in the least any of the conditions or terms of this lease. . . . . . . . 12. . . . . . . 13. . . . . . . . 14. This lease is binding on me, my heirs, executors, administrators, successors and assigns as well as on your heirs, executors, administrators, successors and assigns. I have hereby by this writing granted you this lease by ;my own free will and in my full senses and I bind myself to abide by its terms and conditions mentioned above". The said lessee, N. J. Gamodia died in 1916 leaving a will appointing executors to look after his affairs. The executors assigned the lease to the second defendant, Gamodia Factories Limited by a deed dated November27, 1933. The assignee like the original tenant continued to pay the stipulated rent 'to the lessor Guru padappa till his death which 881 occurred in May, 1939. 'The second defendant in its turn assigned its leasehold interest to the first defendant by a deed dated May 30, 1944. It is common ground that the leasehold property contains factory, buildings and residential quarters. After the lessor 's death his two widows continued to receive rent from the lessees as usual. The plaintiff is the adopted son of the original lessor and was a minor till some time in 1949. The plaintiff sought to terminate the tenancy by issuing notices to the defendants on, the ground (1) that the lease bad created a tenancy at will in the events. that had happened; and (2) that the original lessee had in contravention of the terms of the lease, assigned the benefits under the lease in favour of the defendants. As the defendants did not vacate the premises and deliver possession of them to the plaintiff, in terms of the notice aforesaid, he instituted the suit giving rise to the present appeal for a declaration that the defendants were tenants at will and that their possession after service of notice was wrongful, The suit was. resisted by the first defendant principally on the ground that the lease created not a tenancy at will as claimed by the plaintiff but a permanent tenancy, hence there is no question of the defendant being ejected on the grounds alleged in the plaint. The courts below have decreed the suit and ordered the defendant appellant to give up porsession. In the trial court, a number of issues were struck between the parties. The most important issue upon which the result of the litigation largely defended was the one relating to the nature of the lease created by the lease deed aforesaid. The trial 'court held that it was a lease for 20 years certain, ,and on the efflux of that period on October 26,_ 1934, the second defendant became a tenant at will and as such the tenancy could be terminated at the will of either party, the second defendant and the first defendant were liable to be ejected on service of the 882 necessary notice, which is found to have been properly served. In the result, the plaintiff 's suit was decreed with costs and the defendants were directed to quit the land and the road annexed to the land. and to restore possession of the premises to the. plaintiff after removing the iron and steel machinery and other appurtenances of the factory, but leaving intact the residential quarters and the appurtenances of those quarters. On appeal by the defendants, the lower appellate court affirmed the finding of the trial court and dismissed the appeal with this modification that the defendants were given six, months ' time to restore possession to the plaintiff after removing their machinery etc. The lower appellate court made some other modifications also which are not material to this appeal. On second appeal by the first defendant, the High Court dismissed the appeal with costs, but modified. the findings of the two courts below in so far as it held that after the lapse of the first 20 years of the lease, the tenancy was not a tenancy at will, but a tenancy for an indefinite period which would be valid for the lifetime of the lessee himself as also of the transferees of the lessee namely the second defendant, which is the 'company inasmuch as the original lessor in his lifetime had accepted the assignment of the lease in favour of the second. defendant. The High Court also held that as the second defendant was admittedly no longer in possession of the leasehold and as there has been an assignment to the first defendant, the transfer was not binding on the plaintiff and therefore the first defendant did not become the plaintiff 's tenant. In that view of the matter, the judgment and decree of the courts below were confirmed with the modification that the appellants were given four month 's time to vacate and deliver possession of the premises to the plaintiff The first defendant made an application to ' the High Court for the necessary certificate of fitness for coming up in appeal to this court. but the High Court by its order dated March 29, 1961, 883 refused to grant the certificate. As time was running against the first defendant, he hurried up to this court by a petition for special leave to appeal dated April 10, 1961. On April 20, 1961, this court granted special leave to appeal. That is how the matter comes before us. The controversy between the parties must be determined on a reference to the terms of the lease deed on a proper construction of which the rights and obligations of the parties must be determined. If it is held that after the lapse of the first 20 years of the lease, the defendants became tenants at will, there is no answer to the claim for Possession of the premises. If it is held, as it had been held by the High Court, that the second defendants interest as an assignee of the original lessee created a lease for an indefinite period in favour of the assignee which would enure for the life of the assignee namely the company, then the further question will arise whether or not the first defendant appellant before us had acquired the same interest by virtue of the transfer in his favour. That is one of the alternative arguments raised on behalf of the appellant by his learned counsel. The learned counsel for the appellant also mentioned the ground founded on the provisions of the Mysore Rent Act ; but as that defence has not been raised in the pleadings of the defendant and as that point has not been canvassed in the High Court, we ruled that we shall not permit that contention to be raised here. But the substantial ground on which this appeal has been pressed upon us is that by virtue of the lease deed. of the year 1914, on a proper construction of that grant, a permanent tenancy was created. If that is so, it is common ground that the suit must fail. Naturally therefore, the main argument at the bar on both sides has been devoted to the question, whether or not the lease deed evidences a perpetual grant to the lessee on the terms and conditions contained in the lease deed. 884 Addressing ourselves to that Question, it is clear on a construction of the document Ex I that it was a lease of the demised premises for a term of 20 years certain, on payment of Rs. 350/ annua rent in advance, even though the lessee may not continue to occupy the demised land; that the lessee had been granted a right to continue the lease of the demised premises as long as the lessee desired to do so ; that on his choosing to continue to enjoy the leasehold, the lessee was obliged to pay annually the enhanced rent of Rs. 400/ for the next ten years after October 1, 1934, and after the expiration of the ten years aforesaid, the rent was further enhanced to the sum of Rs. 500/ per annum ; that the lessee was given the option to give up the lease at any time after October 1, 1934, without any further liability for payment of the stipulated rent ; that (and this is a very important stipulation) the lessor bound himself not to call upon the lessee at any time to give up possession of the ease hold as long as the lessee was prepared to observe the terms of the lease, that the lessee was fully authorised "to erect, as many buildings, godowns, factories, bungalows and other structures etc. " as also to pull down and re erect structures or to make any altera tions, as desired by him ; that the lessor undertook not to raise any objection to the lessee making those structures or his using or enjoying the land in any way or for any purposes according to his desire; that the lessor undertook to pay the annual assessment to Government in respect of the demised premises but the lessee was obliged to pay all fines and other taxes which Government might impose for granting permission to convert the culturable land into land meant for building factories and other structures as contemplated between the parties, that if the lessee chose to give up possession of the demised premises, he shall be entitled ' to take away all machinery, iron and steel, wood works etc. of the factories, buildings and other structures that may be standing, that in the event of a default in the payment of the annual rent fixed as aforesaid 885 upon notice of demand served upon the lessee, the reserved the right to re take possession of the demised land. The lessee was also declared by para. 10 quoted above to be always entitled to sub let or re let the demised land to any person and on any terms. As the lease was apparently for the purpose of converting agricultural land into factory premises necessary for running the factory, it was specifically provided that if the Government refused Co give the necessary permission for setting up the factory,, the lease shall be deemed to be ,cancelled. 13 also contains a stipulation that the heirs and assigns of the lessor shall have. no right to disturb the lessee in peaceful possession of the demised premises, and that in the event of any such interference, the lessee shall be entitled to claim damages for the loss suffered by any action on the part of the lessor or his heirs or successors. 14 is also a very important clause in the lease deed, which though coming as the last clause, must 'govern all the stipulations between the parties. Thus the terms and conditions of the lease which created the rights and obligations between the lessor and the lessee were specifically declared to be binding on the heirs and successors in interest of the lessor and the lessee. It is manifest, therefore, on a plain construction of the terms aforesaid of the lease deed that the purpose of the transaction was a building lease that though there was liberty reserved for the lessee or his successor to give up the lease hold at any time after October 1, 1934, no corresponding right was reserved to the lessor. Thus there is no room for the controversy which has occupied a large portion of the judgments of the courts below, that reservation of the right to the lessee to surrender possession at any time, imported a corresponding right to the lessor to call upon the lessee to give up possession. It was an advantage specifically reserved to the lessee without any corers ponding benefit to the lessor. It is equally clear 886 that the lease was heritable and assignable. Thus there is no difficulty in holding that there if; no room for the contention, on the terms of the lease, that the parties intended that after the lapse of the first 20 years of the lease, the tenancy will be merely a tenancy at will. It was clearly a tenancy for an indefinite period, at the least. The contention on behalf of the appellant is that on a proper construction of the lease deed, read as a whole, the inference is clear that the parties intended it to be, a permanent lease. The first argument in support of the conclusion we are asked to arrive at is that it is clearly a lease for building purposes ; and it is rightly pointed out that where the land is let out for building purposes without a fixed period, the presumption is that it was intended to create a permanent tenancy. Reliance, was placed upon the leading case in Navalram vs Javerilal (1) where Sir Lawrence Jenkins, C. J., laid it down that a presumption in favour of a permanent tenancy arises on a transaction like the one we have before us. The terms of the grant in that case are set out in 11 at p. 402 and it is clear on a reference to those terms that the deed was not as strong as we have in the in stant case. Only two things were explicit in the terms of that document, namely, (1) that it was a lease for building purposes and (2) that as long as the lessee continued to pay the stipulated rent, the lessor would not be entitled to call upon the lessee to quit. Reliance was also placed upon the decision of the Calcutta High Court in Promada Nath Roy vs Srigobind Chowdhry (2). In that case the Kabuliat did not specify any period during which the lease was to subsist. It had been stipulated that the land was to beheld from year to year at an annual rent and that in the event of a masonry building being erected on the land, rent was to be assessed at the prevailing rate. Eventually, the tenant (1) (1905) 7 Bom. L. 401. (2) Cal, 648 887 built the structure on the land. It was held by, the Calcutta High Court that ' the parties contemplated the lease to be for building purposes 'and that therefore the court could presume that the lease was intended to be permanent. The terms of the lease in that case also were not as telling an in the case 'before us. Similar was the case of Forbes vs Hanuman ,Bhagat (1) decide by a Divison Bench of the Patna High Court which applied the decision of the Calcutta High Court in Promada Nath Roy vs Srigobind Chowdhry (1) to the case before it. That case was followed by a subsequent Division Bench in the case of Commissioner of Income tax vs Maharajadhiraj Kumar Visheshwar ' singh(3). Fazl Ali, J. , who delivered the leading judgment of the court relied upon the decision of their Lordships of the Judicial Committee of the Pi ivy Council in the case of Janaki Nath Roy vs Dina Nath Kundu (4). Mr. Justice Fazl Ali particularly relied upon two circumstances which in his view supported the inference of the tenancy being permanent, namely., (1) that no term had been fixed in the lease and (2) that the lease deed contained provisions for the exercise of certain rights by the heirs of the lessor and the lessee, apart from the circumstance that the building was for enabling the lessee to build a gola (ware house) and a platform for a rice mill. In all these cases decided by the Bombay, Calcutta and Patna High Courts as also by the Judicial Committee, there was no fixed period as the term of the lease. But it was contended on behalf of the plaintiff respondent that the term expressly granting the lessee the right to give up possession at will was wholly inconsistent with the permanency of the tenancy. In our opinion the presumption raised by the fact that the lease was for building purposes and therefore intended to be permanent is not weakened by the fact that the lessee had stipulated (1) Pat. (2) Cal. (3) Pat. (4)(1931)35 C.W.N.982. 888 with the lessor to be entitled to give up, possession if and when he decided to do so. It is a, right reserved in favour of the lessee and did not confer, as already pointed out, any corresponding right, on the lessor. Such a right in favour of the lessee cannot be converted into a disability or an obligation which should detract from the grant of a permanent tenancy. Such a stipulation which gives a right to the tenant to surrender the lease hold at any time be decided to do,so, if it is coupled with a corresponding right in the landlord to serve notice of ejectment at any time he chose to do so may have the effect of making the tenancy, a tenancy at will, but such a conclusion has been negatived by the High Court and rightly enough. In this connection the following 'Observations of the Privy Council in the case of Baboo Lekhraj Roy vs Kunhya Singh (1) may be quoted: "If a grant be made to a man for an indefinite period, it enures, generally speaking for his lifetime, and passes no interest to his heirs unless there are some words shewing an intention to grant an hereditary interest. That rule of construction does not apply if the term for which the grant is made is fixed or can be definitely ascertained". In that case, a lease had been granted to the respondents ' ancestor to continue during the term of the mokurruri of the grantor. The grantor 's term could be terminated by the owner (in this case the Government) at the end of a year, a power which had never been exercised. In a suit for ejectment by the successor in title of the original lessee, it was held by the Privy Council that the general rule that a lease of an indefinite nature enures for the life of the grantee did not apply to the case, because the interest of the lessor itself had paused from generation to generation. In this case, it has been found by the High Court that. after the lapse of the first 20 years of the (1) (1877) L. R. 4 I.A. 223,252. 889 lease, the lease became one for an indefinite term Which meant on the authority of the decision of the Bombay High Court in Babasaheb vs West Patent Co., Ltd.(,) to which one of us sitting in the Bombay High Court (Gajendragadkar, J.) was a party, a lease for the lifetime of the lessee. The facts of that case were similar to those of the present except in so far as there do not appear in the lease any such terms as are contained in cl. 14 of the lease deed in the instant case. The Bombay High Court therefore had not to consider the terms of a lease which could be said to be in pari materia with those of the present. In that case, the court had to choose between two rival contentions, namely, (1) that the lease created a tenancy at will and (2) that the lease was a lease good enough for the lifetime of the grantee, if it was not indeed a permanent tenancy. We are in complete agreement with the following observations of the court made in that case, which in our opinion apply to the facts and circumstances of the case in hand "The forms in which tenancy rights are created in India are not uniform and they do not conform to precedents known to conveyancing ; sometimes the words used are not precise and it is not easy to understand from the said words the intention of the parties in executing the documents. Leases are often executed without legal assistance; and the aid that the parties obtain from professional scribes does not always contribute to make the terms clear or precise. The nature of the tenancy created by any document must never theless be determined by construing the docu ment as a whole. If the tenancy is for a building purpose, prima facie it may be arguable that it is intended for the life time of the lessee or may in certain cases be even a permanent lease. Prima facie such a lease is not intended to be tenancy at will. But whether it is a tenancy for life or a permanent (1) I. L. R. , 4 50. 890 tenancy must ultimately depend upon the terms of the contract itself. And in construing the terms of 'such contracts the courts must look at the substance of the Matter And decide what the parties really intended to do. " Our task therefore in the present case is to determine what the parties really intended to do. In this connection, it is pertinent to ' re emphasise the following facts : the lessee with a view to raises a substantial structure by way of factory premises, residential quarters and other appurtenant buildings, took a lease of extensive land, about 4 1/2 acres in area ; those lands, at the time of the transaction in question, were being used for agricultural purposes with the permission of the Government who were the ultimate owners. Its character could be changed with the permission of the Government on payment of certain prescribed fees and charges. The parties could not he certain of obtaining the necessary Government sanction to the conversion of the tenancy from agricultural to building purposes. Therefore the stipulation was clearly made that in the event of the Government refusing to sanction the con version, the lease will be deemed to have come to an end. If the permission were forthcoming, and if the lessee put up substantial structures, it would be in his interest to continue in possession of the premises demised by the lease as long as he found it worth his while, but the lessee may have apprehended that circumstances might supervene neces sitating his walking out of the venture. He therefore had to make provision in the lease entitling him to surrender the lease so as to avoid the liability for payment of future rents. But the lessor on his part would be equally anxious to conserve his rights and therefore 'he 'insisted upon the payment of rent for at least 20 years irrespective of the consideration whether or not 'the tenant continued 891 to occupy the premises. Thereafter, the lessor stipulated for enhanced rent of Rs.;. 400/ per annum for the first ton years after the initial period of twenty years aforesaid, and Rs. 500/ thereafter for all times that the lessee continued to occupy the premises. It could not therefore have been in the contemplation of the parties that the lease should be only for the life of the grantee or for an indefinite period which could be terminated at the will of the lessor. In order to ensure that the lessor, should not eject the lessee, at his sweet will, the term was specifically included in the lease that it will not be open to the lessor to do so. It must, therefore, be held that a stipulation entitling the lessee to surrender possession of the premises at his will is not wholly inconsistent with the tenancy being permanent. In this connection, the following observations of the Judicial Committee of the Privy Council in the case of Janaki Nath Roy vs Dina Nath Kundu (1) may be quoted : "On the other. hand, restrictions upon the power of the tenant to dig tanks and build masonry structures (el. 8) and other provisions in the document were relied upon by the Appellants as indicating a tenancy not of a permanent nature. That some provisions are to be found which point in that direction cannot be denied though some of them may be explained by the existence of the special powers to resume Khas possession referred to above. But the question after all, is one of construction of a document, viz., what is the correct view to take of the rights of the parties after considering all the clauses of the kabuliyat and giving due weight to the several indications which point in the different directions ?" It is noteworthy that the lease was intended by, the parties to be heritable and assignable. It (1) (1931) 35 C.W.N. 982, 986. 892 was a lease for twenty years certain, and then in terms which are not wholly unequivocal in respect of the period after the lapse of the initial twenty years. That the lease was not intended to be for the life only of the grantee is clear not only from the facts already noticed, namely, that it was meant for building purposes, was heritable and assignable and had not reserved any right to the lessor to terminate the tenancy, but also from the consideration that the lessor would not gamble upon the life of his lessee when he was making sure of the term of at least twenty years. He must have. known that the factory worked for twenty years, it would go on for ever, according to human calculations. The fact that the lessee stipulated in express terms that he shall always be at full liberty to give up the lease after October 1, 1934, it was argued, was a clear indication of the lease not being a permanent one ; in other words, the contention is that the presumption arising from the fact that the lease was for a building purpose, heritable and assignable is rebutted by the fact that the tenant had insisted upon the stipulation aforesaid. In oar opinion, there is no substance in this contention. It is always open to a lessee of whatever description to surrender his leasehold interest to the lessor, by mutual consent. It is not necessary in law that the mutual consent should be at the time ' the surrender is being made. It is open to the parties to stipulate terms in anticipation of such a surrender. In the instant case, the surrender was to be in express terms agreed to by the parties, at any time after the lapse of the initial period of twenty years. Such a stipulation for the benefit of the lessee cannot be construed as in derogation of the permanency of the tenure, if the parties otherwise agreed to create such a tenure. For the reasons aforesaid, it must be held that the High Court was in error in holding that the present case is governed by the decision of the 893 Bombay High Court in I.L.R. That decision was, with all respect, entirely correct on the terms of the document then before the court. That being so, in our opinion, on a true and proper construction of the lease deed, the presumption in favour of the transaction creating a permanent lease cannot be held to have been rebutted by a stipulation in favour of the tenant having the right to surrender the lease at his choice. That being so, it must be held that the lease deed evidences an intention to create a permanent lease. In view of this finding, it is not necessary to advert to the other contentions raised on behalf of the appellants. For the reasons given above, the appeal must be allowed; the judgement and decree of the courts below are set aside and the suit giving rise to the appeal dismissed with costs throughout. Appeal allowed.

The material terms of the lease in. controversy provided that for the first 20 years the lessee was to pay a fixed rent of Rs. 350/ every year in advance and if if removed his factory within that period be would still have to pay the 'said rent for the twenty years retaining his right to possession; that thereafter he would be free to continue the lease, as long as he liked subject to the payment of the annual rent of Rs. 400/for the first 10 years and thereafter of Rs. 500/ per year, with the right ' to terminate the, lease at any time and the lessor would not have the right to call upon him to give up possession at any time as long as if wanted to, keep the land for his purposes observing the terms of the agreement; that the lessee would be entitled to raise buildings godowns, factories, bunglows or any other structures as he desired; that the lessor would pay the annual land assessment to the Government and the lessee would pay any fines and taxes imposed by the Government for using. agricultural land for building purposes; that the lessee would be free to sublet or relet without affecting the terms and conditions of the lease and that the heirs, executors, administrators, successors and assigns of the lessee as much as those of the lessee would remain bound by the lease. After more than twenty years had elapsed since the lease, which was a registered one, had been executed between the predecessors in interest of the parties, the respondent who succeeded to the original lessor 's title, brought the suit, out of which the present appeal arose, for ejectment of the assignee of the lessee 's interest on the ground that the lease created a tenancy at will and stood determined on service of notice to quit. The trial court and the court of first appeal found in favour of the respondent and decreed the suit. The High Court in second appeal confirmed the decree but relying on a decision of the Bombay High Court in Bavasaheb vs West Patent Co, Ltd. I.L.R. , held that after the lapse of the twenty years the lease was one for an indefinite period and could enure only during the lifetime of the lessee and such 877 assignees as bad been accepted by the original lessor and since the present assignee was not one of them he acquired no right under the lease. Held, that the lease, read as whole and properly construed, created a permanent tenancy and not a tenancy at will or one for an indefinite period valid only during the life of the lessee. It was not correct to say that the stipulation, granting the lessee the right to surrender the lease at any time after the first twenty years gave to the lessor in the absence of such a provision in the lease itself, the, right to call upon the lessee to at quit any time or that the stipulation was inconsistent with a permanent tenancy. The presumption attaching to a lease for building purposes for no fixed period, therefore, was not weakened in the instant case. Janaki Nath Boy vs Dina Nath Kundu, (1931) 35 C.W.N. 982 and Baboo Lekhraj Boy vs Kunhya Singh, (1877) L.R. 4 I.A. 233, referred to. Babasaheb vs West Patent Co., Ltd., I.L.R. , distinguished, Navalram vs Javerilal, , Promada Nath Roy vs Srigobind Choudhry Cal. 648, Forbes vs Hanuman Bhagat, Pat. 452 and Commissioner of Income tax vs Maharajadhiraj Kumar Visheshwar Singh, Pat. 805, discussed. Held, further, that it is always open to a lessee of any description to surrender his lease hold interest to the lessor by mutual consent. It is not necessary in law that there should be such consent at the time when the surrender is made. Since in the instant case, the surrender after the lapse of twenty ) cars had in terms been agreed to by the parties and that stipulation was for the benefit of the lessee, it could not be construed as in derogation of his right to a permanent tenancy.

il Appeals Nos. 751 of 1957 and 10 of 1958. Appeal from the judgment and order dated December 7, 1956, of the Calcutta High Court in Matters Nos. 29 and 58 of 1956. M. C. Setalvad, Attorney General of India, C. K. Daphtary, Solicitor General of India, Sukumar Mitra, Sankar Ghosh and B. N. Ghosh, for the appellants in C. A. No 751 of 57. M. C. Setalvad, Attorney General of India, Sankar Ghosh and D. N. Mukherjee, for the appellants in C. A. No. 10 of 1958. section M. Bose, Advocate Generalfor the State of West 905 Bengal, B. Sen and P. K. Bose, for the respondents (in both the appeals). 1960. September 27. The Judgment of the Court was delivered by HIDAYATULLAH J. These two appeals on a certificate under article 132(1) of the Constitution have been filed respectively by the Burmah Shell Oil Storage land Distributing Co., of India, Ltd., and the Standard Vacuum Oil Company (in this judgment referred to as the appellant Companies) against a common judgment of the High Court of Calcutta dated December 7, 1956. The High Court was moved for writs of mandamus, prohibition and certiorari under article 226, but the petition was dismissed by D. N. Sinha, J. The matter arises out of assessment to sales tax on sale of motor spirit for aviation purposes (shortly, aviation spirit) supplied by the appellant Companies to aircraft bound for countries abroad, under the Bengal Motor Spirit Sales Taxation Act, 1941, as amended by section 2(a)(i) of the Bengal Motor Spirit Sales Taxation (Second Amendment) Act, 1954. The Commercial Tax Officer, the Commissioner of Commercial Taxes and the State of West Bengal have been joined as respondents in this Court, as they had previously been joined in the High Court. The appellant Companies deal in Petroleum and Petroleum products, and carry on business at Calcutta. They maintain supply depots at Dum Dum Airport from which aviation spirit is sold and delivered to aircraft proceeding abroad and belonging to several Companies. It appears that such sales were treated by the sales tax authorities in the State of Bombay as not falling within the taxing Acts in force in the Bombay State by reason of the provisions of article 286 of the Constitution. The sales tax authorities in West Bengal, however, took a different view of the matter, and after sundry procedure resulting in assessment of tax, presented a demand notice for the tax assessed which was paid under protest by the appellant Companies. The appellant Companies filed petitions under article 226 of the Constitution in the High 906 Court of Calcutta questioning the legality of the imposition but without success. They have now filed these appeals after obtaining a certificate, as already stated. The contentions in this Court, as they were also before the High Court, 'are that such sales are made in the course of export of such aviation spirit out of the territory of India, that they take place outside the State of West Bengal, that inasmuch as aviation spirit is delivered for consumption outside West Bengal, the sales cannot fall within the Explanation to sub cl. (a) of the first clause of article 286, and that unless they can be said to become "Explanation Sales", the power to tax does not exist. It is argued in support of the last contention that there is not even an averment in the reply of the respondents before the High Court that aviation spirit is delivered for consumption within West Bengal. The case in the High Court was restricted to consideration of supplies to aircraft which either proceed to foreign countries directly from Dum Dum Airport, or do so ultimately, though landing en route at some place or places in the Indian territory. The case has been similarly confined in this Court also, and we are not required to express any opinion about sales of aviation spirit to aircraft flying from one place in West Bengal to another place also within that State, or even to some place in another State in the territory of India. The facts are fortunately not ' in dispute. Both parties admitted the procedure for the supply of aviation spirit to aircraft. Briefly described, it is as follows: Before the arrival of such an aircraft, a representative of the appellant Companies applies to the Airport Customs Officer to depute an Officer to supervise the refuelling of the aircraft. After the aircraft lands, the captain or the Ground Engineer gives instruction about the quantity of aviation spirit required, and on permission being given by the Customs authorities, the stated quantity is delivered in the presence of the Customs Officer deputed. Details of the delivery are entered in a delivery receipt, which 907 is signed by the representative of the appellant Companies and the Customs Officer deputed. Duty drawback shipping bills are also drawn up to show the ' quantity of aviation spirit and are countersigned by them and also by a representative of the aircraft. Later, claims for refund of customs duty are made, and refund is granted. In the petition filed in the High Court, it was averred that such aviation spirit is required for consumption during flight and/or outside the territory of India, and is thus delivered for purposes of consumption outside West Bengal and in some cases outside the territorial limits of India as well. It was also stated that it was sold in the course of export outside the territory of India, and drawback of customs duty was obtained. In the reply of the respondents, it was stated that the refund of customs duty was an irrele vant fact for the purpose of assessment. It was further stated in the affidavit of the Commercial Tax Officer as follows : " I further state that a foreign bound aircraft on leaving Dum Dum Airport consumes a portion of the aviation spirit taken in by it at the Airport within the territory of West Bengal before it moves out of the said territory or the territory of India. I do not admit that the entire quantity is used outside the territorial limits of India as alleged. I deny that the sale of such aviation spirit takes place outside the State of West Bengal and state that the sale takes place within the State of West Bengal and the purchaser pays its price within the State of West Bengal. The sale of such aviation spirit is completed by delivery at the Dum Dum Airport in West Bengal. " We have mentioned this fact, because it was argued that the respondents had not averred clearly that aviation spirit was sold for consumption within West Bengal even though the appellant Companies had denied it. The respondents pointed out that at least some of the aviation spirit must be consumed in the State, and that this was so stated in the affidavit filed in reply to the petition and quoted by us. This is 908 hardly a case for a fight on pleadings, especially as the entire procedure of the supply of aviation spirit and the use to which it is put are beyond controversy. The question that we have to consider is one of principle, and the answer depends upon broad facts and not on technicalities. Either the whole of the sale is within the taxing power of the State or it is not, and the fact that aviation spirit is consumed in taking off or in flying over the territory of West Bengal before it leaves that territory would make no difference either way to the principles applicable. Though parties entered into a debate on this part of the case, we do not propose to consider it, because, in our opinion, the question must be considered in substance and not in abstractions. The liability to sales tax, if any, is attracted when aviation spirit is sold, and immunity can only be claimed, if, as stated in article 286(1)(a) and the Explanation, the sale can be said to take place outside the State or can be regarded under article 286(1)(b) as having taken place " in the course of. export of the goods out of, the territory of India". Before we take up these two questions, we desire to refer to some provisions of certain Acts, which bear upon the matter. The Indian , is an Act for the control of the manufacture, possession, use, operation, sale, import and export of aircraft. Section 16 of this Act provides that the Central Government may, by notification in the Official Gazette, declare that any or all of the provisions of the Sea Customs Act shall, with such modifications and adaptations as may be specified in the notification, apply to the import and export of goods by air Sections 2(3) and (4) define " import" and " export ' respectively as " bringing into India " and " taking out of India ". A notification issued under the Indian , the rules framed thereunder and the Indian Aircraft Rules, 1920, appointed the Civil Aerodrome, Dum Dum, a Customs Aerodrome, and to that Customs Aerodrome, the provisions of the Sea Customs Act mutatis mutandis were made applicable by r. 63 (Part IX) of the Indian Aircraft Rules, 1920. As 909 a result, Dum Dum Airport became a Customs Aerodrome, and any aircraft coming into India from foreign countries or leaving for any such country has to comply with ordinary Customs formalities. Section 42 of the Sea Customs Act, which allows drawback on re export and is applicable mutatis mutandis, provides: " When any goods, capable of being easily identified, which have been imported by sea into any customs port from any foreign port, and upon which duties of customs have been paid on importation, are re exported by sea from such customs port to any foreign port, or as provisions or stores for use on board a ship proceeding to a foreign port seven eighths. of such duties shall, except as otherwise hereinafter provided, be repaid as drawback: ". (Provisos omitted). Under section 51, no drawback is allowed unless the claim to receive such drawback is made and established at the time of re export, and under section 52, the person claiming drawback has to make and subscribe to a declaration. The procedure which is described in an earlier portion of this judgment bears upon these matters. Coming now to the taxing Acts with which we are concerned, it may be pointed out that the Bengal Motor Spirit Sales Taxation Act, 1941, originally did not contemplate levy of a tax on the sale of aviation spirit. Motor spirit was defined to mean, " any liquid or admixture of liquids which is ordinarily used directly or indirectly as fuel for any form of motor vehicle or stationary internal combustion engine, and which has a flashing point below 76 degrees Fahrenheit ". Sub section (4) of section 3, which is the charging section, provided that no tax shall be levied on the sale of any motor spirit for the purpose of aviation. The Act was amended by the Second Amendment Act, 1954, and sub section (4) of section 3 was omitted, and the proviso to the first sub section was re enacted, adding one more clause to the following effect 910 the tax on all retail sales of motor spirit for the purpose of aviation, which are effected on or after the date of the commencement of the Bengal Motor Spirit Sales Taxation (Second Amendment) Act, 1954, shall be charged at the rate of three annas per gallon ". By the Bengal Motor Spirit Sales Taxation (Amendment) Act, 1955, the original Act was further amended. To the definition of" motor spirit ' quoted by us earlier, an Explanation was retrospectively added, which reads as follows: " Explanation For the avoidance of doubt, it is hereby declared that in this Act, the expression ' vehicle ' means any means of carriage, conveyance or transport, by land, air or water ". The original Act was again amended by the Bengal Motor Spirit Sales Taxation (Amendment) Act, 1957. This time, among other amendments involving rates of tax, the words " and which has a flashing point below 76 degrees Fahrenheit " were omitted from the definition of 'motor spirit '. The result of all these amendments was to make retail sales of aviation spirit liable to sales tax, and 'retail sale ' was defined, at all material times, as a sale " by a retail dealer for the purpose of consumption by the purchaser ". After the coming into force of the Constitution, section 22, in terms of article 286, was added to the original Act by paragraph 3 of, and the Eleventh Schedule to, the Adaptation of Laws Order, 1950. It read: " 22(1). Nothing in this Act shall be construed to impose or authorise the imposition of a tax on the sale or purchase of motor spirit: (a) where the sale or purchase takes place outside the State of West Bengal; (b) where the sale or purchase takes place in the course of the import of such motor spirit into, or export of such motor spirit out of the territory of India; or (c) (omitted). (2) The Explanation to clause (1) of article 286 of the Constitution shall apply for the interpretation of clause (a) of sub section (1) 911 Clauses (a) and (b) of the first sub section do no more than re enact the prohibition contained in article 286 of the Constitution with modifications to Suit motor spirit, and the Explanation to sub cl. (a) of cl. (1) of the said Article in the Constitution has been applied without an attempt to modify or adopt it. The Explanation to sub cl. (a) of the first clause of article 286, the meaning of which was much in dispute in this case, may conveniently be quoted here. It reads: " Explanation For the purposes of sub clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general laws relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State ". The High Court of Calcutta in its judgment dealt with the points urged, and rejected them. The reasons of the High Court briefly were as follows: The learned Judge declined to draw any inference from the fact that customs duties were refunded as drawbacks on aviation spirit delivered to the aircraft. He held that he was not required to decide whether the appellant Companies were entitled to claim and receive drawbacks of customs duty. He then gave a finding that the sale was physically within the State, because both the buyer and the purchaser were, at the time of sale, within the State of West Bengal even though delivery of aviation spirit was beyond the customs barrier. He then considered the legal position in the light of article 286 from three points of view. He first held that it was not an inter State transaction, because both the parties were in the State of West Bengal, and aviation spirit was not delivered outside the State. Thus, he held that el. (2) of article 286 did not apply. In this connection, he relied upon the decision of this Court in the Bengal Immunity Co., Ltd. vs State of Bihar and others (1). He next considered (1) 912 the matter under the first sub clause, and held that unless the fiction created by the Explanation applied, the sale must be treated as within the State under the law relating to sale of goods. In his opinion, the sale being completed within the State of West Bengal both as regards contract and delivery, the fiction could not be held applicable, because no " outside " State was involved, even though the aircraft might have to consume some aviation spirit while flying over the " outside " State. He, therefore, held that the Explanation and article 286(1)(a) which it seeks to explain, were both not applicable. He then considered the matter from the point of view of article 286(1)(b). He explained on the authority of the decision of this Court in State Of Travancore Cochin and others vs Shanmugha Vilas Cashewnut Factory and others (2) that the expression " in the course of export out of the territory of India" referred to sales which, by themselves, occasioned the export of goods out of the territory of India and not to sales for the purpose of export, even though the goods ultimately passed the customs barrier. He pointed out that there was no foreign purchaser to whom the aviation spirit could be said to have been exported, and that aviation spirit, in fact, was consumed en route and never taken to any foreign territory. He also pointed out that no bills of lading or shipping documents were drawn up, and therefore there was neither an export nor a sale in the course of export out of the territory of India. The appellant Companies claim that these sales come within the exemption granted the sub cls. (a) and (b) of the first clause of article 286. To claim the exemption granted by the first sub clause, they rely upon certain decisions of this Court, and contend that unless the sale can be said to fall within the Explanation, it must be treated as a sale outside the State of West Bengal, and is thus exempt. With regard to the second sub clause, they contend that there was an export out of the territory of India inasmuch as aviation spirit was taken abroad and any sale by which it is taken abroad is also exempt These (2) ; 913 arguments, as has been shown above, were urged before the High Court, but were not accepted. These two arguments need to be considered separately, as they have little in common. Article 286 places restrictions upon the power of the States to tax sales and purchase of goods, and cuts down the amplitude of Entry No. 54 in the Second List of the Seventh Schedule. Other restrictions are also to be found in Part XIII of the Constitution. With those we are not concerned in these appeals. We are also not concerned with the subsequent amendment of article 286, nor with the ban imposed by the second clause of the Article on taxes on sales in the course of inter State trade and commerce. We are concerned with the first clause only, as it stood before the amendment. That clause is divided into two sub clauses. The first sub clause prohibits the imposition of tax on the sale or purchase of goods where the sale or purchase takes place outside the State. AD Explanation is added to this sub clause, which has been quoted by us earlier. This Explanation has led to a long controversy in this Court during which somewhat conflicting views have been expressed about its meaning. This conflict has further been accentuated when the interplay between the two clauses has been considered. The view now accepted is that the bans imposed by the two clauses are independent and separate and each must separately be got over. In view of this, we are not required to travel beyond the first clause in this case. We have heard widely divergent arguments in these appeals. The learned Attorney General who appeared on behalf of the appellant Companies read to us copious extracts from the earlier decisions of this Court, and contended that unless the sales could be said to fall within the Explanation so as to become 'Explanation sales ', they must be regarded as having taken place outside the State of West Bengal and for that reason, not taxable. According to him, they could only become 'Explanation sales ' if aviation spirit was delivered for the purpose of consumption within the State of West Bengal. The learned Advocate General of West Bengal, on the other band, 914 contended that the Explanation did not apply to the facts here, and that the observations in the rulings were not relevant. The first sub clause in its opening portion says that no law of a State shall impose or authorise the imposition of a tax on the sale or purchase of goods where such sale or purchase takes place outside the State. It is thus plainly meant that a State is not to tax sales which take place outside that State. But, where does a sale take place ? Numerous elements go to make a sale, and they may take place in more than one State. Under the law relating to the sale of goods, property passes on the happening of certain events. When they happen, the sale is complete. Now, a contract for the sale of goods may be entirely within one State when all parties are within the State, the offer and acceptance also take place there, and the goods are also within that State, and there, the property in the goods passes and delivery also takes place. But it may also happen that the constituent elements may be spread over two or more States, some of the elements described above falling within one State and some others falling within one or more other States. Prior to the Constitution, multiple taxation of a single transaction of sale was possible, and Provincial legislation then existing clearly demonstrates that States having Some connection with the sale because one or more elements took place within those States, treated this as sufficient nexus between the taxing power and the States, authorising them to tax sales even where property passed in another State. The Constituent Assembly desired to achieve certain objects in the matter of taxation, particularly in relation to sales tax. Article 286 achieves, among other objects, the avoidance of this multiple taxation. The first sub clause of the Article is clear in its terms, when it says that a State cannot tax sales which take place outside the State. The converse is also true, that is to say, that a State can tax a sale of goods which takes place within the State. By sale here is meant a completed transaction by which property in the goods passes. Before the property in the 915 goods passes, the contract of sale is only executory, and the buyer has only a chose in action. " Property in the goods passes either by the fulfilment of the conditions of the contract, if any, or by the operation of the law relating to the sale of goods. Starting from the basic fact that what is to be taxed under the Constitution is a sale completed by the transference of property in the goods, we have to see at what stage and where this happens. The taxable event thus cannot be found at any earlier stage when the sale is not completed by the passing of property. The critical taxable event is the passing of property in the goods as a result of a contract for their sale. The parties to the contract can agree when that event is to take place, but where it happens may be a matter of some doubt and even of difficulty. Where the parties have not agreed as to the time of the passing of property, the law relating to the sale of goods furnishes the answer. There too, there may be the same difficulty as to the place of the passing of property. The place of physical delivery of the goods does not help to solve this difficulty, because delivery may, precede or follow the passing of property in the goods. Delivery of goods is, thus, not always an element which determines the completion of a sale, because the sale may be completed both before and after delivery. The Constitution, however, thinks in. ' terms of a completed sale by the passing of property and not in terms of an executory contract for the sale of goods. The essence of the matter being thus the passing of property in goods,, there was always a likelihood of more than one State claiming the right to tax the same transaction. One State might claim that goods in which property passed were in that State, and hence property in the goods passed there. Another State might claim that the conditions precedent to the passing of property were fulfilled in that State and hence the sale was completed by the passing of property there. Yet another State might claim that property passed in that State according as one or more events connected with the passing of property took place within that State. 916 It was to avoid this welter of confusion as far as possible that the Explanation was added, and it also avoided multiple taxation. The Explanation serves two purposes. It indicates the State where the tax can be levied, and also indicates the State or States where it cannot. It achieves these two purposes excluding all considerations as to where property the goods can be said to have passed under the law relating to the sale of goods. The purpose is achieved by the Explanation and particularly by the non obstante clause in the Explanation. Any State claiming to tax a sale of goods on the ground that it was completed by the passing of property in the goods in that State could not do so, if the goods as a direct result of the sale were delivered for the purpose of consumption in another State. The Explanation creates a fiction that the sale must be deemed to have taken place in the latter State and not in the State where the sale was completed by reason of passing of property. It thus discards the test of passing of property and adopts the test of delivery 'as a direct result of such sale for the purpose of consumption in that State '. Where more than one State is involved, any State claiming to tax the sale by reason of something anterior to the passing of property would not be able to claim that the sale took place there unless it was also the State of delivery, because the sale is complete only on the passing Of property, and till the sale is complete, liability to tax does not arise. Once the sale is complete, the delivery State gets the right to tax the sale by the fiction introduced. Now, the Explanation must be ' interpreted according to its own tenor, and it is meant to explain el. (1)(a) of the Article and not vice versa. It is an error to explain the Explanation with the aid of the Article, because this reverses their roles. The Explanation discards the test of passing of property, and adopts the test of delivery as a direct result of the sale for purposes of consumption. This delivery may be in the State where the passing of property also took place, but then, there is no difficulty. The sale is then entirely within the State. The sale is outside 917 the State only when the passing of property takes place in the State, but that is not the State where the goods have been actually delivered as a direct result of the sale for purposes of consumption in that State. The Constitution has, thus, for certain cases shifted and confined the situs of the taxable event to the State of the delivery of goods; but it must be remembered that this delivery,may precede as well as follow the passing of property. It is, therefore, plain that no single element of the contract of sale is by itself a decisive factor in determining which State is to tax the sale where there are more States than one involved, except the test of actual delivery of the goods in a State as a direct result of the sale for purposes of consumption in that State, and it is that State and that State only which has the right to tax the sale and none other. The Explanation is not applicable, unless there are more States than one involved. It is only a key to find out which of the States is competent to tax and which are not, and is by no means a definition of an 'outside sale '. It is an Explanation, which determines which State out of those connected with the transaction of sale can tax it. The interpretation which we have placed upon the first sub clause of article 286(1) is substantially the same, as was placed in the earlier rulings of this Court. In The State of Bombay and another vs The United Motors (India) Ltd. and others (1), it was pointed out that the Explanation formulated an easily applicable test to find out an 'outside sale ' and this, it was said, was done " by defining an inside sale ". It was observed further: " Are the goods actually delivered in the taxing State, as a direct result of a sale or purchase, for the purpose of consumption therein ? Then, such sale or purchase shall be deemed to have taken place in that State and outside all other States ". Certain reasons were given why this test was adopted, and it is these reasons and their effect on the second clause, which led to a re examination of the subclause in The Bengal Immunity Company Limited vs (1) ; 117 918 The State of Bihar and others (1). The majority in that case touched upon the various grounds which were advanced before this Court, but declined to express "any final opinion upon the matter ". The case went on to decide that the bans imposed by the two clauses of article 286 were independent, and needed to be separately enforced. But, on the meaning of the Explanation, no different view was expressed. Again, in M/8. Ramnarain Sons Ltd. vs Asst. Commissioner of Sales Tax and others(2), it was observed as follows: "So far as article 286(1)(a) is concerned, the Explanation determines by the legal fiction created therein the situs of the sale in the case of transactions coming within that category and when a transaction is thus determined to be inside a particular State it necessarily becomes a transaction outside all other States. The only relevant enquiry for the purposes of article 286(1)(a), therefore, is whether a transaction is outside the State and once it is determined by the application of the Explanation that it is outside the State it follows as a matter of course that the State with reference to which the transaction can thus be predicated to be outside it can never tax the transaction (Italics supplied). Now, in so far as this case is concerned, the words the Explanation determines by the legal fiction created therein the situs of the sale in the case of transactions coming within that category " in the extract last quoted, become important. The first question to consider is whether these cases can be governed by the Explanation at all. The learned Attorney General contends that the power to tax these transactions can only be found if the sales were 'Explanation sales ', in the sense that the goods were delivered as a direct result of the sale for consumption in West Bengal. In our opinion, the explanation can apply only if more than one State is involved in the same transaction. When there is no other State in which the goods can be said to be delivered for consumption, apart from the State where the property in the goods passed, the Explanation is not needed as a key. The (1) (2) ; 492. 919 power to tax in those circumstances which is exercisable by virtue of transfer of title to the property, can only be taken away if there be some other State in ' which the goods as a direct result of the sale were delivered for consumption. But if there is no such other State, the question does not arise. In the present cases, there is no such rival State. Where the purchaser buys goods in West Bengal for his own consumption, the test of an 'inside sale ' is satisfied when the property in the goods passes in the same State and all the elements of the contract of sale also take place inside it. Where the property in the goods passes to a buyer who is also the 'ultimate ,consumer, the terms of the Explanation are themselves satisfied. To exclude, thus, the powers of taxation of the State of West Bengal, the appellant Companies must be able to point out some other State where the goods can be said to have been delivered as a direct result of the sale for the purpose of consumption in that other State. Unless they can do so and they have not so done before us they cannot invoke the Explanation, and the cases, to borrow the language of the last quotation, cannot be said to be "within that category ". In our opinion, the learned Advocate General of West Bengal was right in his argument (which was accepted by the High Court) that the ban contained in article 286(1)(a) and the Explanation does not apply. The appellant Companies next rely upon article 286 (1)(b), which provides that: " No law of a State shall impose or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place in the course of the. . export of goods out of, the territory of India ". The contention is that the sales in question must be regarded as having taken place in circumstances which exempt sales under the sub clause. This the appellant Companies argue from the following facts that aviation spirit is delivered outside the customs barrier, that aviation spirit is taken out of the territories of India, and that the sales occasion this 920 export. They rely upon the definition of 'export ' in other Acts to show that the word means no more than 'taking out of the country '. This clause of the Article has been construed on previous occasions by this Court, and what is meant by the expression " in the course of " has been well. established. Indeed, in State of Mysore vs Mysore Spinning and Manufacturing Co. Ltd. (1), this Court observed that the point could no longer be said to be at large. Fortunately, there is less disagreement on this point than on the interpretation of the Explanation, and it is sufficient to refer to the leading decisions of this Court. The earliest case on the subject is State of Travancore Cochin and others vs The Bombay Co. Ltd. (2), where four possible meanings of the expression " in the course of " were considered. It is not necessary to refer to all of them here, and it is sufficient to point out that of the view that the clause is not restricted to the point of time at which goods are exported from India and that the series of transactions which necesssarily precede export of goods also come within the purview of the clause, it was said that it was too wide. It was observed by this Court that: "A sale by export thus involves a series of integrated activities commencing from the agreement of sale with a foreign buyer and ending with the delivery of the goods to a common carrier for transport out of the country by land or sea. Such a sale cannot be dissociated from the export without which ' it cannot be effectuated, and the sale and resultant export form parts of a single transaction. Of these two integrated activities, which together constitute an export sale, whichever first occurs can well be regarded as taking place in the course of the other. " The meaning of these observations was further explained in State of Travancore Cochin and others vs Shanmugha Vilas Cashew Nut Factory and Others (3). It was observed (p. 62) that the words "export out of " in this context did not refer to the article or commodity exported, and that the reference to "the (1) A.I.R. 1958 section C. 1002. (2) ; (3) ; 921 goods " and to the "territory of India " made it clear that the words " export out of " meant the exportation out of the country. It was then added that, "The word 'course ' etymologically denotes movement from one point to another, and the expression 'in the course of ' not only implies a period of time during which the movement is in progress but postulates also a connected relation. " This inter connection of the sale sought to be taxed with the course of export was emphasised again in clear terms thus : " The phrase 'integrated activities ' was used in the previous decision to denote that 'such sale ' (i.e., a sale which occasions the export) I cannot be dissociated from the export without which it cannot be effectuated, and the sale and the resultant export form parts of a single transaction '. It is in that sense that the two activities the sale and export were said to be integrated. A purchase for the purpose of export like production or manufacture for export, is only an act preparatory to export and cannot, in our opinion, be regarded as an act done I in the course of the export of the goods out of the territory of India ' any more than the other two activities can be so regarded. " From the views here expressed, it follows that every sale or purchase preceding the export is not necessarily to be regarded as within the course of export. It must be inextricably bound up with the export, and a sale or purchase unconnected with the ultimate export as an integral part thereof is not within the exemption. It may thus be taken as settled that sales or purchases for the purpose of export are not protected, unless the sales or purchases themselves occasion the export and are an integral part of it. The views expressed in these two cases were accepted and applied in State of Madras vs Gurviah Naidu and Co. Ltd. (1), Kailash Nath vs State of U.P. (2), State of Mysore vs Mysore Spinning and Manufacturing Co. Ltd. (3) and Gordhandas Lalji vs B. Banerjee (1) A.I.R. 1956 S.C. 158. (2) A.I.R. 1057 S.C. 790. (3) A.I.R. 1958 S.C. 1002. 922 and others (1). These cases do not advance the matter further, and it is, therefore, not necessary to refer to them in detail. In the earlier cases, it was not necessary to explain the meaning of the word 'export ', because there was always a foreign buyer to whom the goods were ultimately sent. In none of the cases the facts found here were present. Here, the buyer does not export the goods to a foreign country, but purchases them for his own use on the journey of the aircraft to foreign countries. This difference is vital, and makes the position of the appellant Companies, if anything, weaker. It is for this reason that the appellant Companies depend on a wide meaning of the word 'export ', which they illustrate from other Acts where the word is tantamount to "taking out of the country '. We are of opinion that this meaning cannot be given to the word 'export ' in the clause. The word 'export ' may conceivably be used in more senses than one. In one sense, 'export ' may mean sending or taking out of the country, but in another sense, it may mean sending goods from one country to another. Often,, the latter involves a commercial transaction but not necessarily. The country to which the goods are thus sent is said to import them, and the words 'export ' and import ' in this sense are complementary. An illustration will express this difference vividly. Goods cannot be said to be exported if they are ordered by the health authorities to be destroyed by dumping them in the sea, and for that purpose are taken out of the territories of India and beyond the territorial waters and dumped in the open sea. Conversely, goods put on board a steamer bound for a foreign country but jettisoned can still be said to have been exported ', even though they do not reach their destination. In the one case, there is no export, and in the other, there is, though in either case the goods go to the bottom of the sea. The first would not be within the exemption even if a sale was involved, while any sale in the course of the second taking out would be. In both, the goods were taken out of the country. The difference lies in (1) A.I.R. 1958 S.C. 1006. 923 the fact that whereas the goods, in the first example, had no foreign destination, the goods, in the second example, had. It means, therefore, that while all exports involve a taking out of the country, all goods taken out of the country cannot be said to be exported. The test is that the goods must have a foreign destination where they can be said to be imported. It matters not that there is no valuable consideration from the receiver at the destination end. If the goods are ex. ported and there is sale or purchase in the course of that export and the sale or purchase occasions the export to a foreign destination, the exemption is earn. Purchases made by philanthropists of goods in the course of export to foreign countries to alleviate distress there, may still be exempted, even though the sending of the goods was a not a commercial venture but a charitable one. The crucial fact is the sending of the goods to a foreign destination where they would be received as imports. The two notions of export and import, thus, go in pairs. Applying these several tests to the cases on hand, it is quite plain that aviation spirit loaded on board an aircraft for consumption, though taken out of the country, is not exported since it has no destination where it can be said to be imported, and so long as it does not satisfy this test, it cannot be said that the sale was in the course of export. Further, as has already been pointed out, the sales can hardly be said to 'occasion ' the export. The seller sells aviation spirit for the use of the aircraft, and the sale is not integrally connected with the taking out of aviation spirit. The sale is not even for the purpose of export, as explained above. It does not come within the course of export, which requires an even deeper relation. The sales, thus, do not come within article 286 (1)(b). These sales must, therefore, be treated as made within the State of West Bengal. The customs barrier is a barrier for customs purposes, and duty drawback may be admissible if the goods once imported are taken out of the country. The customs duty drawbacks have nothing to do with the sale of aviation 924 spirit, which takes place in West Bengal. The cus toms barrier does not set a terminal limit to the territory of West Bengal for sales tax purposes. The sale beyond the customs barrier is still a sale, in fact, in the State of West Bengal. Both the buyer and the seller are in that State. The goods are also there. All the elements of sale including delivery, payment of price, take place within the State. The sale is thus completely within the territory of the taxing State. No outside State is involved where the goods can be said to have been delivered for consumption as a direct result of the sale that takes place. Article 286(1)(a) and the Explanation are wholly inapplicable, and the sale cannot, even by a fiction, be said to be outside the State of West Bengal. No doubt, aviation spirit is taken out of the State and also the territory of India, but it cannot be said to have been exported or delivered for consumption in some other State. The so called export is not occasioned by the sale, and the sale, on the authorities cited, is not in the course of export ', so as to attract article 286(1)(b). The decision of the High Court was correct. The appeals fail, and are dismissed with costs. One hearing fee. Appeal dismissed.

The appellant companies which were carrying on business in Calcutta in petroleum and petroleum products maintained supply depots at Dum Dum Airport from which motor spirit for B the purposes of aviation was sold and delivered to aircraft which either proceeded to foreign countries directly from that Airport or did so ultimately, though landing en route at some place or places in the Indian territory. Dum Dum Airport was a customs aerodrome and all aircraft coming into it or leaving it had to comply with ordinary customs formalities. The sales tax authorities of West Bengal sought to levy tax on the sales of motor spirit as aforesaid under the provisions of the Bengal Motor Spirit Sales Taxation Act, 1941, as amended. The appellant companies claimed that the sales were exempted from taxation under both the clauses (a) and (b) of article 286(i) of the Constitution of India on the grounds (i) that the sales in question had taken place outside the State of West Bengal, as they did not .come within the Explanation to article 286(1)(a), (2) that aviation spirit was delivered outside the customs barrier and therefore the sales were outside the State, and (3) that the sales had taken place in the course of export, as aviation spirit was taken out of the territory of India. Held: (i) that by sale in article 286(i)(a) is meant a completed transaction by which property in the goods passes. Before property in the goods passes the contract of sale is only executory and the buyer has only a chose in action. The taxable event is not to be found at an earlier stage because the critical taxable event is the passing of property. The Explanation to cl. (1) of article 286 was added to avoid, among other things, multiple taxation of the same transaction. It indicates the State where the tax can be levied and also the State where it cannot. It achieves it by excluding from consideration the place where the property in the goods passed according to the law relating to sale of goods. The non obstante clause establishes this. By the fiction created by the Explanation a sale is deemed to have taken place in the State where the goods are delivered as a direct result of the sale for purposes of consumption in that State. Where there are more States than one involved, any State claiming to tax a sale by reason of something anterior to the passing of property would not be able to claim that the sale took place there unless it was also the State of delivery. The Explanation is meant to explain the Article and must be interpreted according to its tenor and the Explanation is not to be explained with the aid of the Article because that would reverse their roles. The Explanation is not applicable unless there are more States than one involved. The State of Bombay vs The United Motors (India) Ltd., , State of Travancore Cochin vs Shanmugha Vilas Cashewnut Factory, ; , Ramnayain Sons Ltd. vs Asst. 904 Commissioner of Sales Tax; , and The Bengal Immunity Company Ltd. vs The State of Bihar, [1955] 2 S.C.P. 603, considered. (2) that to exclude the power of taxation of the State of West Bengal under article 286(i)(a), read with the Explanation, the appellant companies must be able to point out some other State where the goods could be said to have been delivered as a result of the sale for the purpose of consumption in that other State, and that where, as in the present case, aviation spirit was delivered to the aircraft, there was no such rival State, and therefore, the ban contained in article 286(i)(a) and the Explanation, did not apply. (3) that in the phrase " in the course of export out of the territory of India " in article 286(i)(b) the word " export " does not merely mean 'taking out of the country '. Export here means that the goods are being sent to a foreign destination at which the goods can be said to be imported. In the Article the notions of import and export go in pairs. State of Travancore Cockin vs The Bombay Co. Ltd., ; and State of Travancore Cochin vs Shanmugha Vilas Cashew Nut Factory, ; , relied on. (4) that aviation spirit loaded on board the aircraft for consumption, though taken out of the country, was not exported since it had no destination where it could be said to be imported. The sales in question could not, therefore, be said to have occasioned the export, nor were they in the course of export. Accordingly, article 286(i)(b) was not applicable. (5) that the sales must be treated as made within the State of West Bengal. The customs barrier did not set a terminal limit to the territory of West Bengal for the purposes of sales tax, and the sales, though beyond the customs barrier, were still within the territory of the taxing State.

l Appeal No. 135 of 1958. Appeal from the judgment and order dated 114 394 September 4, 1956, of the Punjab High Court in Civil Writ Case No. 325 of 1965. N. A. Palkhivala and J. B. Dadachanji, for the appellant. C. K. Daphtary, Solicitor General of India, K. N. Rajagopal Sastri and D. Gupta, for the respondents. September 27. The Judgment of the Court was delivered by HIDAYATULLAH J. The appellant firm, L. Hazarimal Kuthiala of Kapurthala, moved the High Court of Punjab under article 226 of the Constitution for writs of prohibition, certiorari, quo warranto etc., against the Income tax Officer, Special Circle, Ambala and the Commissioner of Income tax, Punjab (1), Himachal Pradesh, Bilaspur and Simla in respect of reassessment of the income of the firm for the account year, 1945 1946. The High Court dismissed the petition, but granted a certificate under articles 132 and 133 of the Constitution, and this appeal has been filed on that certificate. The firm carried on business as forest lessees and timber merchants at Dhilwan in the former Kapurthala State. In that State, an Income tax law was in force, and prior to the integration of the State, on April 10, 1947, the income of the firm for the account year 1945 1946 (Samvat. 2002) was duly assessed, and the tax was also paid. Subsequently, political changes took place, Kapurthala integrated into what was known as Pepsu, and the Rajpramukh issued two Ordinances in Samvat. 2005, by which all laws in force in Kapurthala including the Income tax law ceased to be operative from August 20, 1948. The two Ordinances instead applied laws in force in the Patiala State to the area of the new State which included Kapurthala, and the Patiala Income tax Act, 2001, came into force. Later still, the Indian Finance Act, 1950 (26 of 1950), applied the Indian Income tax Act to the Part B States, which had emerged as a result of political changes. Section 13 of the Indian Finance Act, 1950, repealed the Income tax laws obtaining in the area of the Part B States except for the purposes 895 of levy, assessment and collection of income tax and super tax in respect of the period defined therein. On March 12, 1955, the Income tax Officer, Special Circle, Ambala, issued a notice purporting to be under section 34 of the Patiala Income tax Act of Samvat. 2001 to the appellant firm calling upon it to file a return of its income and total world income, because he had reason to believe that the income had been underassessed. Previous to this, on November 4, 1953, the Commissioner of Income tax, Punjab (1), Himachal Pradesh, Bilaspur and Simla, purporting to act under section 5, sub sections (5) and (7A) of the Indian Income tax Act, ordered that the assessment of the appellant firm would be done by the Income tax Officer, Special Circle, Ambala and not by the Income tax Officer, B Ward, Patiala, who ordinarily would be the competent authority under section 64 of the Indian Income tax Act to assess the appellant firm. The appellant firm raised objections, but failed, and then filed the petition under article 226 of the Constitution, out of which the present appeal arises. Numerous objections were taken in respect of the competency of the proceedings before the taxing authorities, but some of them are no longer pressed. An argument under article 14 of the Constitution has now been abandoned, though it figured at earlier stages of the present case. A second point that the reassessment cannot be made under the Patiala In. come tax Act is not in dispute, because the respondents before us stated that the reassessment, if any, would have to be done in accordance with the Kapurthala law, as it existed in the assessment year (Samvat. 2002). A third argument, namely, that the words of section 13 of the Indian Finance Act, 1950, did not include reassessment, has also been abandoned, in view of the decisions of this Court in Lakshmana Shenoy vs The Income, tax Officer, Ernakulam (1) and The Income tax officer, Bangalore vs K. N. Guruswamy (2). Only one point has been pressed before us, and it is that the Income Tax Officer, Special Circle, Ambala, had no jurisdiction to issue a notice under section 34, and (1) [1959] S.C.R. 751. (2) ; 896 that only the Income tax Officer, B Ward, Patiala, was the competent authority. Reliance is placed in this connection upon the provisions of section 64(1) of the Indian Income tax Act, under which the locally situated Income tax Officer would have had jurisdiction in this case. The transfer of the case by the Commissioner of Income tax by his order dated November 4, 1953, is characterised as ultra vires and incompetent, and it is this argument alone to which we need address ourselves in this appeal. The Patiala Income tax Act contained provisions almost similar to sections 5(5) and 5(7A) of the Indian Income tax Act. Sub section (5) differed in this that the Commissioner of Income tax was required to consult the Minister in charge before taking action under that sub section. The only substantial difference in the latter sub section was that the Explanation which was added to section 5(7A) of the Indian Income tax Act as a result of the decision of this Court in Bidi Supply Co. vs Union of India (1) did not find place in the Patiala Act. The Commissioner, when he transferred this case, referred not to the Patiala Income tax Act, but to the Indian Income tax Act, and it is contended that if the Patiala Income tax Act was in force for purposes of reassessment, action should have been taken under that Act and not the Indian Income tax Act. This argument, however, loses point, because the exercise of a power will be referable to a jurisdiction which confers validity upon it and not to a jurisdiction under which it will be nugatory. This principle is wellsettled. See Pitamber Vajirshet vs Dhandu Navlapa(2). The difficulty, however, does not end there. The Commissioner, in acting under section 5(5) of the Patiala Income tax Act, was required to consult the Minister in charge. It is contended that the Central Board of Revenue which, under the Indian Finance Act, 1950, takes the place of the Minister in charge was not consulted, and proof against the presumption of regularity of official acts is said to be furnished by the fact that under the Indian law no such consultation was necessary, and the Commissioner, having purported (1) [1056] S.C.R. BOM. 486, 489. 897 to act under the Indian law, could not have felt the need of consultation with any higher authority. This, perhaps, is correct. If the Commissioner did not act under the Patiala law at all, which enjoined consultation with the Minister in charge and purported to act only under the Indian law, his mind would not be drawn to the need for 'Consultation with the Central Board of Revenue. Even so, we do not think that the failure to consult the Central Board of Revenue renders the order of the Commissioner ineffective. The provision about consultation must be treated as directory, on the principles accepted by this Court in State of U. P. vs Manbodhan Lal Srivastava (1) and K. section Srinivasan vs Union of India (2). In the former case, this Court dealt with the provisions of article 320 3)(c) of the Constitution, under which consultation with the Union Public Service Commission was necessary. This Court relied upon the decision of the Privy Council in Montreal Street Railway Company vs Normandin (3), where it was observed as follows: ". . The question whether provisions in a statute are directory or imperative has very frequently arisen in this country, but it has been said that no general rule can be laid down, and that in every case the object of the statute must be looked at. The cases on the subject will be found collected in Maxwell on Statutes, 5th Ed., p. 596 and the following pages. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience, or injustice to persons who have no control over those entrusted with the duty, and at the same time would not promote the main object of the Legislature, it has been the practice to hold such provisions to be directory only, the neglect of them, though punishable, not affecting the validity of the acts done. " The principle of the Privy Council case was also applied by the Federal Court in Biswanath Khemka vs The King Emperor (4), and there, as pointed out by this (1) [1058] S.C. R. 533. (3) ; (2) ; , 1321. (4) 898 Court, the words of the provision were even more emphatic and of a prohibitory character. The essence of the rule is that where consultation has to be made during the performance of a public duty and an omission to do so occurs, the action cannot be regarded as altogether void, and the direction for consultation may be treated as directory and its neglect, as of no consequence to the result. In view of what has been said in these cases, the. failure to consult the Central Board of Revenue does not destroy the effectiveness of the order passed by the Commissioner, however wrong it might be from the administrative point of view. The power which, the Commissioner had, was entrusted to him, and there was only a duty to consult the Central Board of Revenue. The failure to conform to the duty did not rob the Commissioner of the power which he exercised, and the exercise of the power cannot, therefore, be questioned by the assessee OD the ground of failure to consult the Central Board of Revenue, provision regarding which must be regarded as laying down administrative control and as being directory. Learned counsel, however, contends that even if all this be decided against him, he is still entitled to show that the transfer of the case can only take place under sub section (7A) of section 5 and not under sub section According to him, the former subjection deals with the transfer of individual cases, and that inasmuch as there was no pending case at the time, then, as was ruled by this Court in the Bidi Supply case (1), the transfer could not be valid. In the absence of an Explanation similar to the one added to the Indian Income tax Act, he contends that a case which was not pending, could not be transferred under sub section He contends also that sub section (5) deals not with the transfer of individual cases but with the distribution of work. The two sub sections of section 5 of the Patiala Income tax Act read as follows: " (5) Income tax officers shall perform their functions in respect of such persons or classes of persons or of such incomes or classes of income or in respect of (1) ; 899 such areas as the Commissioner of Income tax may in consultation with the Minister Incharge direct, and, where such directions have assigned to two or more Income tax Officers, the same persons or classes of persons or the same incomes or classes of income or the same area, in accordance with any orders which the Commissioner of Income tax may in consultation with the Minister Incharge make for the distribution and allocation of work to be performed. The Minister Incharge may, with the previous approval of the ljlasi Khas, by general or special order in writing, direct that the powers conferred on the Income tax Officer by or under this Act shall, in respect of any specified case or class of cases, be exercised by the Commissioner, and, for the purposes of any case in respect of which such order applies, references in this Act or in any rules made hereunder to the Income tax Officer shall be deemed to be references to the Commissioner. (7A) The Commissioner of Income tax may transfer any case from one Income tax Officer subordinate to him to another, and the Minister Incharge may transfer any case from any one Income tax Officer to another. Such transfer may be made at any stage of the proceedings, and shall not render necessary the re issue of any notice already issued by the Income tax Officer from whom the case is transferred. " There can be no doubt that sub section (7A) authorises ,the Commissioner to transfer individual cases. The words " any case from one Income tax Officer subordinate to him to another ", " such transfer may be made at any stage of the proceedings " etc., clearly indicate this. Sub section (7A) is, however, not applicable here, because in respect of the cognate sub section of the Indian Income tax Act it was ruled by this Court that it could apply to a pending case only. It was to overcome this lacuna that the Explanation was added by the Indian Parliament. This amendment came in 1956, and the Patiala Act did not include a similar Explanation, because prior to 1956 the question had not arisen. There is one other difference between the Patiala Act and the Indian Act. Whereas sub section (7A) was introduced in the Indian Act by an 900 amendment, the corresponding sub section was enacted at the same time as the rest of the Patiala Act. Now, it is quite clear that a case which was not pending at the time of transfer could not be transferred under sub section (7A) of section 5 of the Patiala Act. The same reasoning must be applied to that subsection, as it was applied to the Indian Act. Learned counsel referred us to an affidavit by the Under Secretary, Central Board of Revenue, reproduced in Pannalal Binjraj vs Union of India (1), which stated the reason for the introduction of sub section It is a little difficult to accept the affidavit as an aid to find out the intention why a particular law or amendment was enacted, more so where the affidavit concerns quite another Act of a different legislature. It is, however, pertinent to remember that sub section (7A) expressly gave the power to transfer pending cases, but said nothing about cases which were riot pending. The power to transfer such cases before they came into being must, therefore, be found in some other enactment. The Department contends that it would fall within sub section (5) of section 5, and points out that this Court was not required to consider that sub section, because the transfer of the cases dealt with in the Bidi Supply case (2) was by an authority not named in sub section (5) and therefore the transfer in those instances could not be held to be under that sub section. The Department contends that the Commissioner of Income tax is mentioned both in sub section (5) and sub section (7A) and could derive his power from one or the other or both. The short question thus is whether an individual case which was not a pending case could be transferred from one Income tax Officer to another under sub section (5) of section 5 of the Patiala Act, which was kept alive for assessment and reassessments relating to previous assessment years. Mr. Palkhivala argues that the words of the sub section " such persons or classes of persons or of such incomes or classes of income or in respect of such areas " denote, by the plural employed, a dealing with a group rather than (1) ; 246. (2) ; 901 an individual case. He further contends that if individual cases were held to be included in sub section (5), then sub section (7A) would be unnecessary and otiose. He argues that harmonious construction thus requires that the two sub sections must be taken to cover different situations. The last argument is hardly open after the decision of this Court adverted to already. If pending cases alone were within sub section (7A), those cases which were not pending could not be said to have been provided for, there. There is thus no overlapping at least in so far as cases not pending were concerned. An arrangement for their disposal would be a subject of distribution of work and nothing much turns upon the employment of the plural number, because the plural includes the singular. Indeed, a single case might well be in a class separate from others. Duplication of powers is sometimes noticeable in statutes, and does not destroy the effectiveness of the powers conferred. Section 24 of the Civil Procedure Code dealing with transfers of cases and the provisions of the Letters Patent of the High Court are instances in point. If a particular action is valid under one section, it cannot be rendered invalid because the identical action can also be taken under another section, and it makes no difference if the two empowering provisions are in the same statute. In any event, sub section (7A) would cut down sub section (5) only to the extent the former provides, and it has been held that it was confined to pending cases only. Sub section (5) was thus available for cases which were not pending, and the case which was 'the subject matter of the Commissioner 's order was not a pending case. Mr. Palkhivala contends that sub section (5) merely enables distribution of work, and does not deal with transfers. But where a case is not pending, an order relating to it may take the form of transfer or an arrangement for its disposal. There is nothing to prevent the Commissioner, acting under sub section (5), to arrange that the case of an assessee shall be disposed of by a particular Income tax Officer. The words of 115 902 sub section (5) that " Income tax Officers shall perform their functions in respect of such persons as the Commissioner may direct " only show that the Commissioner may direct that one Income tax Officer shall not and another Income tax Officer shall, perform the functions in respect of such and such person or persons. The plural including the singular, the order of the Commissioner was valid, because he arranged and distributed work, and did not seek to transfer any case. It is, however, contended that this renders sub section (7A) otiose. In our opinion, it does not. Special provision for transfer of pending cases is all that is provided there, and if such a transfer takes place, the provisions of sub section (7A) will be invoked. Those provisions are to be read as not pre judicing the general powers granted by sub section (5) and vice versa. For these reasons, the appeal fails, and will be dismissed with costs. Appeal dismissed.

The appellant firm which carried on business as forest lessees and timber merchants in the former Kapurthala State was assessed to, and paid, income tax, for the account year 1945 46 under the Income tax law which was then in force in the said State. Subsequently Kapurthala State integrated into what was known as Pepsu and the Patiala Income tax Act, 2001, was made applicable and, came into force in the integrated State. Later still the Indian Finance Act, 1950 (26 of 1930), applied the Indian Income tax Act to Part B States which had emerged as a result of political changes and section 13 Of the Indian Finance Act repealed the Income tax laws obtaining in Part B States except for the purposes of levy assessment and collection of income tax and Super tax relating to the period mentioned therein. On November 4, 1953, the Commissioner of Income tax, Punjab (i) etc. purporting to act under section 5, sub sections (5) and (7A) of the Indian Income tax Act ordered the assessment of the appellant firm to be done by the Income tax Officer, Special Circle, Ambala and not by the Income tax Officer, B Ward, Patiala, who would ordinarily be the competent assessing authority for the firm under section 64 Of the Indian Income tax Act. On March 12, 1953, the Income tax Officer, Special Circle, Ambala, issued a notice purporting to be under the Patiala Income tax Act of Samvat 2001 to the appellant firm for filing a return of its income and total world income as he believed that the income had been underassessed. The appellant then filed an application under article 226 of the Constitution in the High Court for writs of prohibition, certiorari, quo warranto etc. against the Income tax Officer, Special Circle, Ambala, and the Commissioner of Income tax, Punjab (i) etc. regarding the reassessment of the income of the firm for the account year 1945 46. The High Court dismissed the said petition and this appeal was filed on a certificate granted by the High Court. The contentions of the appellant inter alia, were that the Income tax Officer, Special Circle, Ambala, had no jurisdiction to issue a notice under section 34 893 of the Patiala Income tax Act of Samvat 2001, and that only the Income tax Officer, B Ward, Patiala, was the competent authority as he was the locally situated Income tax Officer and would have jurisdiction under section 64(1) of the Income tax Act. The transfer of the case by the Commissioner of Income tax by his order of November 4, 1954, was characterised as ultra vires and incompetent. The argument that the words of section 13 Of the Indian Finance Act, 1950, did not include reassessment was abandoned in view of the decisions of this Court in Lakshmana Shenoy vs The Income tax Officer, Ernakulam, [1959] S.C.R. 751. It was further contended that the Commissioner in acting under section 5(5) of the Patiala Income tax Act was required to consult the Minister in Charge whose place was taken by the Central Board of Revenue under the Indian Finance Act, 1950. Held, that although the Commissioner of Income tax was required to consult the Central Board of Revenue his failure to do so did not render his order ineffective however wrong it might be from the administrative point of view. The provision about consultation must be treated as directory and the Commissioner 's power could not be questioned by the assessee on the ground of failure to consult the Central Board of Revenue. State of U.P. vs Manbodhan Lal Srivastava, [1958] S.C.R. 553, K. section Srinivasan vs Union of India, ; , Montreal Street Railway Company vs Normandin, L.R. 1917 A. C. 170 and Biswanath Khemka vs The King Emperor, , followed. The Commissioner while transferring the case may have referred to the Indian Income tax Act and not to the Patiala income tax Act but the exercise of the power would be referable to a jurisdiction which conferred validity upon it and not to a jurisdiction under which it would be nugatory. Pitamber Vajirshet vs Dhandu Navlapa, I.L.R. , followed. A case which was not pending at the time of transfer could not be transferred under sub section (7A) of section 5 of the Patiala Act but it could be transferred from one Income tax Officer to another under sub section (5) Of section 5 of the Patiala Act which was kept alive for assessment and reassessment relating to previous years. Sub section (7A) makes special provision for transfer of pending cases and is not prejudicial to the general powers granted by sub section Bidi Supply Co. vs Union of India, ; , refer red to.

ION: Criminal Appeal No. 31 of 1961. Appeal by special leave from the judgment and order dated October 7, 1958 of the Andhra Pradesh High Court in Criminal Appeal No. 456 of 1957. Ram Reddy for the appellants. Ratna Rao and K R. Choudhri, for respondent No 1. A. Ganganatham Chetty and T.M. Sen. for respondent No.2. October 5. The Judgment of the Court was delivered by HIDAYATULLAH, J. The two appellants who were granted special leave by this Court, appeal against the judgment of the High Court of Andhra Pradesh convicting them, on appeal against acquittal, of an offence under. 380 of the Indian Penal Code and sentencing them to six months ' rigorous imprisonment and a fine Rs. 500/ each, with further rigorous imprisonment for one month in default of payment of fine. The prosecution case which had a chequered career in the High Court and the two Courts below, is as follows: In Dusi, which is a part of Bhaskararaopuram, there was a Press known as Srinivasa Printing Press at Srinivasa Ashram. This Press existed for over 17 years. Pappala Chinna Ramadasu (P.W.4) was admittedly a printer and for some years, the declared keeper of that Press under section 4 of the Press and Registration of Books Act, 1867. The declarations were made in 1944 (Ex.P.4) and 1947 (Ex. On November 21, 1955, 10 Pappala Chinna Ramadasu sold this press by a registered document (Ex.P. 1 ) to one Boddepalli Lakshminarayana for Rs 4,000/ , of which Rs.3,500/ were shown to have been paid in advance and the balance was received by Pappala Chinna Ramadasu on January 10, 1956, (Ex.P.2). Two applications were then made on December 1, 1955, respectively by Chinna Ramadasu and Boddepalli Lakshminarayana before the Collector and District Magistrate for substituting the name of Boddepalli Lakshminarayana in place of that of Pappala Chinna Ramadasu in the declaration. On December 6, 1955, by exhibit P.11 they were informed that they should apply under the Press and Registration of Books Act (25 of 1867). Subsequently, on January 11, 1956, a declaration under section 4 of that Act was made by Boddepalli Lakshminarayana and was accepted (Ex.P.3). The case of the prosecution further is that Boddepalli Lakshminarayana went to Kurnool on March 20, 1956, and in his absence, the two appellants with two others (who were prosecuted but acquitted) removed the Printing Press on the night of March 25, 1956 to Korlakota where the first appellant, Apparao, resides. A report of the offence (Ex. P 13), purporting to be written on March 27, 1956, was handed in at the police station house on the following day at 8 P.m. The police took no action, and a complaint was, therefore, filed on April 4, 1956, by Boddepalli Laksminarayana. The Judicial Second class Magistrate, Srikakulam, convicted the two appellants of an offence under 8. 380 of the Indian Penal Code, and acquitted the two others, with whom we are not concerned, and sentenced each of the appellants to imprisonment till the rising of the Court and a fine of Rs. 250/ , with simple imprisonment for one month in default. On appeal, the Additional District and Sessions Judge, Srikakulam, set aside the conviction and acquitted them. The complainant then obtained special leave of the High Court to file 11 appeal against this acquittal, and the High Court reversed the acquittal, as already indicated above. In support of the prosecution case, the complainant examined four witnesses, including himself. Pappala Chinna Ramadasu was examined as P.W.4 to prove that he had sold the Press to Boddepalli Lakshminarayana, and two other witnesses were examined to prove the removal of the Printing Press by the appellants. The defence of the appellants was as follows: According to them, the Press originally belonged to one Govindachari, and on October 25, 1947 he transferred it to Kuna Appala Naidu by exhibit D 2. In the registered sale deed then executed, Govindachari was joined formally by Pappala Chinna Ramadasu. The sale was for Rs. 6,400/ and on the same day, a promissory note was executed by Kuna Appala Naidu in favour of Govindachari, which was attested by Pappala Chinna Ramadasu. Subsequently, Appala Naidu made payments of certain amounts, and endorsements on tho promissory note showing these payments were signed by Pappala Chinna Ramadasu as a witness. Kuna Appala Naidu was examined as D.W.1, and he stated that, the name of Pappala Chinna Ramadasu was formally included in the transfer deed, since the declaration stood in his name. He also stated that the deed, exhibit D.2, was signed as witness by one Akkala Naidu, who died years before the present controversy started. Kuna Appala Naidu later sold the Press to the second appellant and one Sri K. Sriramda, and the second appellant continued in possession as owner. Pappala Chinna Ramadas continued as the printer, and his declaration as the keeper of the Press also continued. In 1953, Pappala Chinna Ramadasu left the Press for good. The Press was leased out by the second appellant to one Appanna, and this leave continued till 1956. On March 19, 1956, an agreement for leave was executed in favour of the first appellant, and on March 26, 1956, a registered deed was duly 12 executed. According to the appellants, the Press WAS removed during the day on March 27 and the lease amount was paid on the 28th. According to them, the second appellant was the owner, in law and in fact, of the Press and the first appellant was the lessee and had removed the Press in the bona fide exercise of his right as lessee. The appellants examined eight witnesses in support of their case. The case of the prosecution hinged upon the evidence of Pappala Chinna Ramadasu, when confronted with exhibit D 2, he denied his signature, and stated evasively that he could not identify the signatures of Govindachari and Appala Naidu. He admitted, however, that Appanna used to look after the Press after 1953, though he said that he used to visit the Press once in two or three months before he sold it to P.W.1, and that the correspondence used to be made in his name. He also stated that he had purchased the Press from the Madras Type Foundry Co., for RH. 9,107/ but that the bills were lost, and he added that they were taken away along with the Press, when it was removed. The case of the appellants rested upon the proof of the signature of Pappala Chinna Ramadasu on Es. D 2 and additionally the proof of the signature of Akkala Naidu, beoause if Akkala Naidu signed the document in 1947 and died some four years before the present controversy started, there would be good reason to think that a document of this character could not be a fabricated one. The appellants examined a handwriting expert, Sri B. R. Singh (D.W.8). He stated categorically that Ex. D 2 bore tho signature of Pappala Chimla Ramadasu. The signature of Akkala Naidu was proved by his son, Sri Rangam. He identified the signature of his father not only on that document but also on exhibit D 3, the promissory Dote. He also stated that h father had died in 1951. From this material, the Additional District and Sessions Judge, Srikakulam, found that Ex D 2 13 was not a forged document, as was suggested, but was amply proved as genuine by Pappala Chandrudu (D.W 4) and the combined evidence of Sri Rangam (D. W. 3) and Sri B. R. Singh (D. W. 8). He therefore, held that Pappala Chinna Ramadasu had no right to sell the Pres in 1955 to Boddepalli Lakshminarayana and that his connection with the Press had effectively ceased from. 1953 even as a mere printer. It is unnecessary to examine whether this finding or the finding given by the Judicial Second Class Magistrate, Srikakulam, who held otherwise, was the correct inference from the. facts. The learned Judge of the High Court, who heard the appeal against the acquittal, said nothing about exhibit D 2. According to him, the removal of the Press amounted to theft, even though the appellants removed it under a bona fide claim of right. In this statement of the law, the learned Judge was, with respect, clearly in error. This is what the learned Judge observed: "Further, to a charge of theft, the plea that the property was removed under a bona fide claim of right would not avail. For example a person who bona fide believes that the fountain pen on his neighbour 's desk is his has no right in law to trespass into the neighbour 's house and snatch away the pen without the latter 's content. " The first of the statements is certainly not the law. It is settled law that where a bona fide claim of right exists, it can be a good defence to a prosecution for theft. An act does not amount to theft, unless there be not only no legal right but no appearance or colour of a legal right. in 2 East . 659, the law was stated a long time ago thus: "If there be in the prisoner any fair pretence of property of right, or if it be brought into doubt at all, the court will direct an acquittal." 14 And according to I Hale P.C. 509, the best evidence is that the goods were taken quite openly. The law thus stated by East and Hale has not been altered in modern times. There are numerous cases in which Courts in India have recognised a bone fide claim of right as a defence to the charge of theft. See Ratanlal law of Crimes 19th Ed. p. 933. We are not concerned in this case with the declaration under the Press and Registration of Books Act. A declared keeper of the Press is not necessarily the owner thereof so as to be able to confer title to the Press upon another. The ownership of the Press is a matter of the general law and must follow that law. Whether Pappala Chinna Ramadasu was not only the declared keeper of the Press but also its owner can only be effectively decided by the Civil Court. For purposes of Criminal law, the evidence prima facie pointed to a transfer of the Press by Pappala Chinna Ramadasu and Govindachari to Kuna Appala Naidu. The evidence prima facie also established that the appellants had taken possession of the Press under a bona fide claim of right, and that, in our opinion. was sufficient to dispose of the present case. The Additional District and Sessions Judge, Srikakulam, had rightly held that the matter was for the decision of the Civil Court, and that this was not a case of theft under the Indian Penal Code, and had rightly directed the acquittal of the appellants. The learned Judge of the High Court considered the declaration by Pappala Chinna Ramadasu, which continued Unchanged, as sufficient to prove an offence of theft. In our opinion, in tho circumstances and in the light of the finding given by the District and Sessions Judge with regard to exhibit D 2, it was necessary to go further to see what right Pappala Chinna Ramadasu had to the Press at all. If this had been considered, the learned Judge would have seen that there was some doubt the right of Pappala Chinna Ramadasu 15 to transfer the Press in 1955 to Boddepalli Lakshminarayana, and further that the defence that the appellants took possession of the Press under a bona. fide claim of right was a good defence entitling them to an acquittal. In the result, this appeal must succeed. The convictions of the appellants and the sentences passed on them are set aside, they are acquitted and their bail bonds shall stand discharged. The fines, if realised, are ordered to be remitted. Appeal allowed.

On a complaint by one L, the Magistrate convicted the two appellants of an offence under section 380 of the Indian Penal Code for having removed a printing press alleged to have belonged to L to whom it was sold in 1955 by one R once a declared keeper of the said press under section 4 of the Press Act, 1867. The defence was that the Press originally belonged to one G. In 1947 transferred it to N by exhibit D 2 wherein R joined formally, as declaration of keeper stood in his name. N sold the Press to the second appellant and another, but R 's name continued as a printer and keeper of the press In 1956 the second appellant leased out the press to the first appellant. According to the appellants, the second appellant was the owner in law and fact of the press and the first appellant was the lessee and had removed the press in the bonafide exercise of his right as lessee. The case of the prosecution hinged upon the evidence of R and that of the appellants rested upon the proof of the signature of R on exhibit D 2 which R denied. The handwriting expert stated categorically that exhibit D 2 bore the signature of R. The Judge of the High Court who heard the appeal against the acquittal order, passed by the Additional District and Sessions Judge, said nothing about exhibit D 2 and considered the declaration of R under section Of the Press Act which continued unchanged, as sufficient to prove an offence of theft. According to him, the removal of the Press amounted to theft even though the appellants removed it under a bonafide claim of right. ^ Held, that where a bonafide claim of right exists, it can be a Good defence to a prosecution for theft. An act does not amount to theft, unless there be not only no legal right but no appearance or colour of a legal right. For the purpose of criminal law on the present case the evidence prima facia pointed to a transfer of the press by R and to N. The evidence prima facie also established that the appellants had taken possession of the press under a 9 bonafide claim of right and there was some doubt about the right of R to transfer the press to L and further the defence that the appellants took possession of the press under bonafide claim of right was a good defence entitling them to an acquittal.

Appeal No. 459 of 1958. Appeal by special leave from the judgment and decree dated June 29,1955, of the former Andhra High Court in Second Appeal No. 730 of 1949. A.V. Viswanatha Sastri and 'P. V., R. Tatachari, for the appellants. K. Bhimasankaram and G. Gopalakrishanan, for the respondents. September 29. The judgment of Wanchoo, Das Gupta and Shah, JJ., was delivered Wanchoo, J., Dayal J. delivered a separate 912 WANCHOO, J. This is an appeal by special leave from the judgment and decree of the Madras High Court. The appellants were defendants in a suit brought by the respondents for possession of certain properties which originally belonged to one Subbarayudu. The case of the respondents was that Subbarayudu executed a will dated September 15, 1885. Under that will the property passed on hit; death to his wife with life interest and after her death absolutely to his daughter Krishnavenamma who was in enjoyment thereof till her death in 1933. The daughter executed a will on March 24, 1933, in favaur of her step son Nagaraju who came into possession of the property on her death soon after. Nagaraju in his turn executed a will on August 16, 1933, by which he gave life interest to his wife who was the first plaintiff (now the first respondent before us) and thereafter the property was bequeathed absolutely to his daughters. The second respondent is the tenant of the first respondent. Nagaraju died soon after executing the will and the case of the first respondent was that she came into possession of the property on his death and was in enjoyment thereof till she was forcibly ejected in 1943 by the appellants who claimed to be the purchasers of the property from Seetaramayya and Ramakotayya who in their turn claimed to be the reversioners of Subbarayudu. Consequently, the suit out of which the present appeal has arisen was filed in June, 1944, for possession and mesne profits. The suit was resisted by the appellants, and their case was that they had purchased the property from the reversioners of Subbarayudu in 1942. It was further contended on their behalf that on the death of Krishnavenamma the reversioners came into possession of the property through the tenants who had been in possession from before under a lease granted to them by Krishnavenamma. These tenants remained in possession till the sale deed in favour of the appellants and attorned to the 913 appellants thereafter. Later the two tenants surrendered possession to the appellants who thus came into actual possession of the property in suit. The appellants also contended that the so called will executed by Subbarayudu was a forgery and the first respondent had no title to the property. On these pleadings, the main point that arose for decision was whether the first respondent had title to the property and was in possession of it till she was dispossessed in 1943. Further the title set up by the appellants was also gone into and their claim as to possession came up for consideration. The trial court found that the will said to have been executed by Subbarmyudu was not proved. In consequence of this finding, it came to the conclusion that the title of the first respondent which depended upon the proof of this will was not a legal title. Further it found that it was not established that Seetaramayya and Ramakotayya were the next reversioners to the estate of Subbarayudu. The result of these findings was that no title was found in either party. These findings have been upheld by the Subordinate Judge and also by the High Court in second appeal and therefore it must now be accepted that both the parties have no title to the property in suit. The main contest therefore centred round possessory title which was also asserted by both the parties in the trial court. On this question the trial court found that after the death of Krishnavenamma, the name of the first respondent was entered in the revenue papers in her place but the property was actually in possession of the two tenants by virtue of the lease executed in their favour by Krishnavenamma in 1929 for six years. Therefore, there was a kind of race between respondent No. I and Seetaramayya and Ramakotayya who set themselves up as reversioners to obtain the favour of these two tenants, and the so. called reversioners managed to obtain in June, 1933, a kadapa from the two tenants for five years 914 ending with May, 1938. They also executed a cowle in favour of the tenant,% and both these documents were registered in July, 1933. But the finding of the trial court was that there was no payment of rents in the years 1933 'and 1934 and that the real fight for the land started towards the end of 1935 or the beginning of 1936 and although documents were taken from the tenants by the so called reversioners no actual payment of rent was made to them. It also held that in this game of winning the favour of the tenants the real gainers were the tenants who paid no rent to either the first respondent or the so called reversioners. The trial court further held that it was in 1936 that the first respondent managed to dispossess the tenants forcibly through her tenant Moka Subbarao who seems to have been a person of some influence in the village. Thereafter the first respondent remained in possession through her tenant till she was dispossessed in November, 1943, forcibly by the present appellants after they had purchased the lands from the go called reversioners. In effect, therefore. the finding of the trial court was that neither party was in Possession. of the property up to 1936 and it was only in 1936 that the first respondent came into possession through Moka Subbarao by dispossessing the tenants who were holding the land from the time of Krishnavenamma and had paid no rent to anybody after her death In consequence the trial court hold that as the possession of the first respondent was earlier she was entitled to succeed at least on the ground of possessory title. Incidentally it also held that although the title of the first respondent was defective for the reason that Krishnavenamma did not have absolute right in the property it was not :void but was only voidable at the instance of the nearest reversioner or some one else having better title, which the appellants or their predecessors in interest did not have. In the result the suit was decreed with mesne profits. 915 This was followed by an appeal to the Subordinate Judge by the present appellants. We have already said that the Subordinate Judge upheld the findings of the trial court on the title of the parties and came to the conclusion that the title of neither party was proved. He also rejected the view of the trial court that the first respondent at any rate had some title though defective it might be. He then addressed himself to the question of possessory title and considered whether the finding of the trial court that the first respondent was in possession ' earlier than the appellants and was therefore entitled to recover possession on the basis of her. possessory title, was correct. He. came to the conclusion that the so called reversioners had got possession of the property peacefully immediately after the reversion opened. in 1933 and therefore the appellants were entitled to maintain their possession as they derived their title from the so called reversioners who had earlier possession than the first respondent. In coming to this conclusion the Subordinate Judge relied on the Kadapa executed by the tenants in favour of the so called reversioners in June, 1933, and the cowle executed by the so called reversioners in favour of the tenants. But the Subordinate Judge did not consider the further question which was considered by the trial court,. namely, whether after the execution of the Kadapa and the cowle the so called reversioners. ever collected rents from the tenants who were there from the time of Krishnavenamma between 1933 and 1936. This question had been specifically considered by the trial court and it had come to the conclusion that though the kadapa and the cowle had been executed they were mere paper transactions and the so called reversioners had never collected rents during this period and the tenants had never paid the rent to anybody during this period. The Subordinate Judge, however, allowed the appeal and dismissed the 916 suit on the view taken by him that the so called reversioners had come into possession of the property after the death of Krishnavenamma end were forcibly ejected in 1936 by Moka Subbarao as the tenant of the first respondent. This was followed by a second appeal by the respondents. The High Court took the view that the finding of the Subordinate Judge that the so called reversioners were in possession from 1933 to 1936, could not be accepted. According to the High Court, the main question was whether the tenants who were there from before really attorned to the reversioners. The High Court then went into some of the evidence and held that various matters which should have received the attention of the Subordinate Judge in coming to a conclusion on this important point of fact were not considered by him; therefore it was not prepared to accept the finding of the Subordinate Judge in second appeal and required the Subordinate Judge to submit a fresh finding on this question. When the ' matter went back to the Subordinate Judge he examined the entire evidence and came to the conclusion that the so called reversioners in order to create evidence of possession had taken the kadapa from the tenants after winning them over to their side, perhaps by a promise not to collect rent from them. He also came to the conclusion that the so called reversioners were not in possession of the property after the death of Krishnavenamma from 1933 to 1936 and that it appeared that during that period neither party was in possession and only 'the tenants who were there from the time of Krishnavenamma continued to being possession but without paying rent to anybody. He further held that in the circumstances the possession of the tenants could only 'be treated as that of the rightful owner which neither party was in this case. Finally he came to the conclusion that it was for the first time in 1936 that Moka Subbarao took possession of the 917 land as the tenant of the first respondent and the appellants got possession for the first time in 1943. Therefore he held that as the first respondent 's possession was earlier it must be restored. This finding was accepted by the High Court with the result that the second appeal was allowed and the order of the trial court restored. The appellants have come to this Court by special leave. The main contention urged before us on behalf of the appellants is that the High Court had no jurisdiction in second appeal to reverse the finding of fact arrived at by the first appeal court as to possession, and inasmuch as the High Court indirectly reversed that finding by calling for a further finding on the question of possession, the judgment of the High Court should be set aside as without jurisdiction. On the other hand it has been urged on behalf of the respondents that though the first order of the High Court calling for a finding looks as if it was interfering with a finding of fact as to possession, a close examination of the circumstances and the findings of the trial court and the first appellate court will show that in fact there was no finding by the first appellate court on the crucial question which arose in the suit resting on possessory title and therefore the High Court was justified in calling for a finding in the matter. It is urged that where the case is based on possessory title only, a party must establish effective possession before it can succeed on its possessory title. On the question of effective possession the trial court had found that though there was a kadapa by which, it may be said, the tenants who were there from before had attorned to the so called reversioners, that was a mere paper transaction and the tenants never paid rents to the so called reversioners; as such,the reversioners never had effective possession between 1933 and 1936. According to the respondents, this finding of the trial court should have been specifically considered by the Subordinate 918 Judge; but all that 'the Subordinate Judge did 'was" to rely on the kadapa and hold on the basis of that document that the so called reversioners had come into possession peacefully. It is said that whatever may be said about the value of attornment: made in favour of the true owner the position. is different where attornment is in favour of a person who is not the true owner. In such case before the person in whose favour an attornment has been made, can establish that , his possession was effective it must also be shown that he was paid rent by the tenants who attorned to him. Therefore, it is urged that, as there was no finding by the Suboridnate Judge on this crucial question the, High Court was justified in sending the case back to the Subordinate Judge for a finding in this regard. As such, it is urged that this is not a case where the High Court had reversed, a finding of fact by the first appellate court which it is admitted it has no jurisdiction to 'do; but it is a case where there was no finding on the crucial question of fact by the Subordinate Judge and the High Court therefore hid jurisdiction to call for a finding in this regard. We are of opinion that though on a first reading of the High Court judgment calling for,a finding it does look as if the High Court was reversing the finding of fact as to possession ' when it called for a further finding on the question, a closer examination of its Judgment calling for a finding along with the findings by the Munsif and the Subordinate Judge on the crucial question involved in this case shows that it held that there was no 'finding by the Subordinate Judge on that crucial question,, though the trial court had given a finding in favour of the first respondent in that respecter, As both parties were relying on possessory title, it was necessary that they should prove effective possession over the, property in order to succeed on the basis of possessory title. By effective possession we mean either ' actual possession or 919 possession through a tenant who must have paid rent voluntarily or under a decree to the person claiming possessory title. The kadaps by the previously existing tenants in favour of the so called reversioners all along been treated as an attornment by all the three courts and we therefore accept it as such. If the so called reversioners Third title in the sense that they were the next reversioners, then attornment by the kadapa would have been sufficient to establish their possession over the property; but where the person in whose favour the attornment bad been made has no title,, a mere paper attornment would not be enough to establish as against third parties the possession of the person in whose favour attornment has been made and it will still have to be shown that the possession. was effective in, the sense that the person who attorned also paid rent voluntarily or under a , decree to the person in whose favour he made the attornment. The fact that, the tenants who had executed the kadapa may be estopped from challenging the title of the so cAlled reversioners, if a suit was brought Against them makes no difference to the position stated above. The finding of the Munsif was that no rent had been paid to anyone by the tenants; further no suit had, been brought by the so called reversioners, to recover the rent before the first respondent got into possession. The kadaps therefore remained a mere paper transaction and attornment through it would not be sufficient to put the so called reversioners in effective possession and confer possessory title on them which could be taken advantage of by the appellants to show earlier possessory title as against the undoubted Possessory title of the first respondent from 1936. It seems to us that, that is what the High Court meant when it said that the crucial question in this case was "whether the tenants really attorned to the reversioners". We emphasise the word "really" Which shows that the High Court was not satisfied With mere paper attornment which was all 920 that was found by the Subordinate Judge and rightly required in a case based on possessory title only that the attornment should be a real attornment, i. e., one in which the person attorning should also have paid rent either voluntarily or under a decree to the person in whose favour the attornment was made. The Subordinate Judge, however, had merely considered the paper attornment and had not considered the evidence as to payment of rent, which was, there and which had been considered by the trial court. The trial court had come to the conclusion after considering the evidence relating to payment of rent that in fact there was no payment though the attornment was made through the kadapa. The trial court therefore held that from 1933 to 1936, only the tenants were in possession but they never paid rent to anybody and thus neither party was in possession through them. This aspect of the finding of the trial court was completely overlooked by the Subordinate Judge who decided the question of possession merely on the paper attornment (namely, the kadapa). What the High Court seems to have meant when it said that the real question was not properly considered by the Subordinate Judge therefore was that he was merely satisfied with paper attornment in a case based on possessory title which was not enough in law and had not given any finding as, to whether the attornment was a reality in the sense that the rent was paid and would thus result in effective possession of the so called reversioners through the tenants. It seems to us therefore that though the form in which the High Court expressed itself when it called for a finding was not happy, what the High Court really did was to hold that there was no finding by the Subordinate Judge on the question of effective possession of the so called reversioners after a consideration of the evidence relating to payment of rent etc.; it therefore called for a finding on the question of effective, possession after 921 consideration of the entire evidence. This in our opinion the High Court was justified in doing because the trial court had considered the entire ,evidence and had come to the conclusion that the so called reversioners had no effective possession and the attornment through the kadaps was a mere paper transaction. In these circumstances it cannot be said that the High Court had no jurisdiction to call for a finding. It is not disputed that if the High Court had jurisdiction to call for a finding the final order of the. High Court allowing the appeal based on the finding which was submitted was not open to question. We therefore dismiss the appeal but in the circumstances pass no order as to costs of this Court. RAGHUBAR DAYAL, J. I agree that the appeal be dismissed, but for different reasons. If Narasimhulu and Ramudu alias Mark, who were in possession of the land in suit under the lease, exhibit P 6, dated May 6, 1929, for six years from Josyula Krishnavenamma, had attorned to Ramakotiah and Seetharamiah by executing the Kadapa (Kabuliat) exhibit D 4, on March 16, 1933, I do not think that any further payment of rent was necessary to make the attornment effective and am of opinion that in that case the view of the learned Subordinate Judge to the effect that the predecessors in interest of the defendants appellants were in possession through their tenants over the land in suit, Was correct. The High Court did not decide by its first order remitting the point No. 2, viz., ,whether the plaintiffs got into possession of the suit properties earlier than the defendants and their predecessor in title and whether they are entitled to recover possession of the suit properties on the strength of their Possessory title ' for a fresh finding that the attornment by the execution of the deed of Kadapa was not good attornment without the executants paying rent to Ramakotiah and Seetharamiah. The learned Judge simply said: 922 "Apart from 'the question whether the principle of law adopted by the learned. Judge is welf founded or not, on which I express no opinion at present it seems to me that the finding of the learned Judge that,, the first defendant bad prior, possession from 193 to 1936 cannot be accepted in second appeal" The finding about the prior possession, of the learned Subordinate Judge was not accepted by the High Court because it considered that the Subordinate Judge bad not closely scrutinized the evidence in the case on the very crucial question in issue between the parties. This crucial question was formulated as 'whether the tenants really attorned to the reversgioners and the reversioners recognized the possession of the tenants as theirs. ' What was want by the High Court from this question, is not clear to me. If the execution of the deed, exhibit D 4, amounted to the attornment by the tenants in favour of Seetharamiah and Ramakotiah, who claimed to be the heirs of Krishnavenamma, and the execution of the cowle, exhibit D 5, by those two persons in favour of the tenants, to the recognition of the tenants as their tenants, no further question of scrutiny of any other evidence on record could have arisen. The other evidence on record about which the High Court expressed its opinion, and that too not in a final form, as a fresh finding was being called on the basis of that evidence, mainly consisted of the evidence in favour of the defendant,%. Non consideration of that evidence could have been a grievance to the defendants, but not to the plaintiffs appellants before the High Court. Expression of opinion in that form on such evidence wag detrimental to the interest of the defendant in a fresh 'consideration of that evidence by the Subordinate Judge, who,, naturally, in his fresh finding, followed a practically similar line of criticism against "that evidence. The mere fact that certain evidence had not been closely scrutinized or, in other orders, not scrutinized, in & manner, in which the second 923 appellate Court desires, it to be scrutinized, cannot be round for interference with the finding of fact in the second appeal. If the High Court considered, is being now urged for the respondent, that without proof of the tenants actually paying rent to,, Seetharamiah and Ramakotiah, who laid claim as heirs but have been proved to be not heirs of Rat Krishnavenamma, there was no valid attornment, the order for a fresh finding about attornment could be justified on the ground that the Subordinate Judge had not referred to the evidence having a hearing on the question of the payment of rent by the tenants and its receipt by the new landlords Seetharamiah and Ramakotiah. I however find it difficult to put such a construction on the High Court 's order when it did not decide upon the principle of law adopted by the first appellate Court. "Attornment, in its strict sense, is an agreement of the tenant to a grant of the reversion made by the landlord to another, or, as it has been defined ', 'the act of the tenants putting one person in the place of another as his landlord" see paragraph 732, Foa 's General Law of Landlord and Tenant. This means that in the first instance attornment is made in favour of the person who has derived his title or supposed ' title from the Original landlord. It implies a continuity of the tenancy created by the original landlord in favour of the tenant. It is in these circumstances that the existing tenant, for the rest of the period of his Tenancy, agrees to acknowledge the new landlord as his landlord. Such an agreement of the tenant amounts to attornment and by such an attornment the tenant by his act substitutes the new landlord in place of the previous one. Such attornment is complete the moment the tenant agrees to acknowledge the new landlord to be his landlord. Any future payment or non payment of rent does not affect the relationship created by the attornment. The new landlord will have his remedies with respect to the rents falling in arrears. 924 Again, it is stated in paragraph 745 at page 475 : "With regard to the title of person from whom the possession was not obtained, but who has been recognised as landlord by the tenant, such recognition may be by express agreement, by attornment, or other formal acknowledgment (as by paying a nominal sum of money), by payment of rent, or of a. nominal sum as rent, or by submission to a distress. " The attornment is here described as one mode of recognising a person as one 's landlord, just as payment of rent is another mode for the purpose. Expression to similar effect is to be found in paragraphs 746, and also 747 where it is further noted : "But the tenant is not allowed to impeach the title of a person to whom he has paid rent, or whose title he has otherwise recognised, without showing a better title in some other person. Thus he cannot, after attorning to a person who derives his title under a will, contend merely that upon a true construction o f the will he had no title; nor can he, after paving him rent, dispute his title merely on the ground that the devise to him was void, owing to the incapacity of the testator. " In krisna Proshad Lal Singha Deo vs Baraboni Coal Concern (1) the Privy Council said at page 318, when considering the scope of section 116 of the Indian Evidence Act: "Whether during the currency of a term the tenant by attornment to A who claims to have the reversion, or the landlord by acceptance of rent from B who claims to be entitled to the term, is estopped from disputing the ' claim which he has once admitted,, we important questions, but they are instances of cases which are outside section 116 altogether. " (1) (1937) L. R. 64 I. A. 311. 925 And again, at page 319 "In the ordinary case of a lease intended as a present demise which is the case before the Board on this appeal the section applies against the lessee, any assignee of the term and any sub lessee or licencee. What all such persons are precluded from denying is that the lessor had a title at the date of the lease, and there is no exception even for the case where the lease itself discloses the defect of title. The principle does not apply to disentitle a tenant to dispute the derivative title of one who claims to have since become entitled to the reversion, though in such cases there may be other grounds of estoppel, e.g., by attornment, acceptance of rent etc. In this sense it is true enough that the principle only applies to the title of the landlord who let the tenant in ' as distinct from any other person claiming to be reversioner." These observations make it clear that simply by attornment the tenant is estopped from questioning the derivative title of the claimant 's successor just as the acceptance of rent will create an estoppel against the landlord from denying the person, who paid the rent, to be his tenant. These observations do not indicate that any actual payment of rent by the tenant who has attorned is necessary to make the attornment effective. If it was otherwise, the new landlord in whose favour the tenant has attorned, will not be able to take successfully any action against that person till that person had made the first payment of rent. I am therefore of opinion that on co the tenant has agreed to accept the person claiming title from the previous landlord, that amounts to effective attornment in favour of the landlord and is no more dependent on the future conduct of the tenant by way of payment of rent or otherwise. 926 A person can establish his possessory title by establishing that he had been in actual possession of the land in suit or had been in possession through tenants. So long as the persons in actual possession are deemed to be his tenants on account of their conduct in recognising that person as their landlord and are estopped to question his title, I see no good reason why their possession be not taken to be, the possession on behalf of that person, irrespective of the fact whether that person bad legal title or not. If he had legal title, no question of relying on possessory title would ever arise. It is only in the case of his failure to establish his legal title that he has to fall back upon possessory title. I see no good reason why the possession of tenants who had attorned to a person having no title be not considered to be his possession in determining whether he had preferential possessory title to that of another, who too has no title and secured possession of the land subsequent to the attornment. In this view of the matter, I am of opinion that the High Court was wrong in asking for a fresh finding on the question of possession when it bad not decided that the tenants had not, in law, attorned to Seetharamiah and Ramakotiah, on the basis of the two documents Kadapa exhibit D 4 and Cowle exhibit D 5, and when according to the first appellate court, the effect of those documents was that the tenants had attorned to them. I am, however, of opinion, though the point was not raised, that the Kadapa exhibit D 4 is not an agreement by tenants simply accepting the claimants to be the new landlords as, by this document, they do not just substitute the new landlords in the place of the old. They really took a new lease from those two persons. The terms of the new lease were different from those of the lease of Krishnavena The unexpired period of the tenancy was two years. Under the Kadapa, the new tenancy was to continue for five years from June, 1933. The lease does not cover just the land which they held under 927 their previous tenancy, but included some other land as well. The amount of rent they were to pay also differed. It was much reduced. Such a document is not a deed of attornment but is a document accepting fresh tenancy. Seetharamiah and Ramakotiah could not in law lease the land in suit to those tenants as they had no tit ,in themselves, they being not heirs of Krishnavenamma. Any lease executed by them created no right. These lessors were not in actual possession of the land at any time. They could not have, therefore, conveyed possession to their tenants. As the new lesseess got no title under the lease, their continued possession over the land in suit could not be possession under the lease on behalf of the new lessors, especially when their possession can be traced to the valid tenancy under the deed, exhibit P 6, in favour of Krishnavenamma and will be deemed to be on behalf of legal heir. Seetharamiah and Ramakotiah, therefore, cannot be held to be in possession of the land in suit through their tenants between June, 1933, and some time in 1936, when those tenants were dispossessed by Moka Subba Rao on behalf of plaintiff No. 1. It follows that the predecessors in interest of the defendants have been rightly held to be not in possession of the land in suit prior to plaintiff No. 1, 'who too. , had no title, getting possession of the land in suit and that the order under appeal is correct. Appeal dismissed.

In the present suit for possession the courts found that none of the parties had a legal title to the property in the dispute and in determining which of the parties had possessory title to the said property the trial court found that on the death of the daughter of the original owner the so called reversioners got a Kodaha (Kabuliyat) executed in their favour by two tenants of the last possessory of the property and themselves executed a cowle in their favour but the said tenants did not pay any rent to the so called reversioners. The trial court held that,though there was a kadapa by which it might be said that the tenants who were there from before had attorned to the so called,reversioners it was a mere paper transaction as no rent was paid. On appeal the first appellate court relying, on the Kadapa and, cowle, found that the so called reversioners got peaceful possession of the property but did not enter into the question whether any rent was paid to them by the tenants. On, second appeal the High Court held that the real question was whether the tenants really attorned to the reversioners and as the, first appellate court did not consider whether there: was.real attornment by, payment, Of rent sent back the case to the said court for a fresh finding,on that question whereupon that court returned a finding in favour of the respondent on the question of possession. The contention of the appellant on appeal by special leave was that the High Court had no jurisdiction in second appeal to reverse a finding of fact arrived at by the first appellate Court and as the high Court indirectly reversed that finding of fact by calling for a further finding on the question of possession the judgment, of the High Court should be set aside. Held (per K. N. Wanchoo, K.C Das Gupta and K.J.C. Shah, JJ.) that if the so called reversioners had title in the sense that they were the next reversioners, then attornment by the Kadapa would have been sufficient but where a person in whose favour attornment had been made had no title, a mere paper attornment would not be sufficient unless there was a real attornment in the sense that the person who attorned also paid rent voluntarily or under a decree to the 911 person in whose favour the attornment was, made. The first appellate court had merely considered the paper attornment and had not considered the evidence as to the payment of 'rent which was there and had been considered by the trial court. The High Court was therefore, justified in calling for. a finding on a question which was not considered by the lower appellate court. Per Raghubar Dayal, J. Once a tenant agreed, to accept the person claiming title from the previous landlord, that amounted to attornment in favour of the new landlord and was no more dependent on the future conduct of the tenant by way of payment of rent or otherwise., Krishna Prasad Lal Singha Deo vs Baraboni Coal Concern, (1937) L. R. 64 I. A. 31 I , referred to. There was no good reason why the possession of tenants who had attorned to a person having no, title be not considered to be, his possession in determining whether he had preferential possessory title to that of another who too had no title. The mere, fact that certain evidence had not been closely scrutinised in other words, not scrutinised in a manner in which the second appellate court desired it to be scrutinised, could not be a ground for interference with a finding of fact in second appeal. In the present case the Kadapal the terms of which were different from those of the old one was not a deed of attornment merely substituting the new landlord in place of the old but was a document accepting fresh. tenancy but as the new lessors had no title to the property the ' lease executed by the created no right.

l Appeal No. 96 of 1952. Appeal from the Judgment and Order dated the 9th April, 1951, of the High Court of Judicature at Calcutta (Sen and Chunder JJ.) in Civil Rule No. 1038 of 1950 arising out of the Order dated the 4th July, 1960, of the Court of the 6th Judge, Presidency Small Causes Court, Calcutta, in Ejectment Suit No. 6571 of 1949. Arun Kumar Dutta and, Shivdas Ghosh for the appellant. Panchanan Ghose (section P. Ghose, with him) for the respondent. January 29. The Judgment of the Court was delivered by DAS J. This appeal is directed against the judgment and order of a Bench of the Calcutta High Court passed on the 9th April, 1961, in Civil Rule No. 1038 of 1950. The facts leading up to this appeal may be shortly stated as follows : The respondents were, according to the appellant, monthly tenants under the appellant in respect of three rooms, one kitchen, one privy and a bathroom on the ground floor of premises No. 6, Roy Began 535 Street, Calcutta, at a monthly rent of Rs. 25 payable according to the Bengali calendar month. On the 29th Baisakh 1356 B. section the appellant gave notice to the respondents to quit the premises on or before the 7th Jaistha 1356 B.S. The respondents having failed to comply with the notice the appellant on the 1st June, 1949, instituted proceedings under Chapter VII of the , for the eviction of the respondents from the demised premises on the allegation that the tenancy had determined ipso fact,) for nonpayment of rent for three consecutive months in terms of section 12 (3) of the West Bengal Premises Rent Control Act, 1948. The respondents on the 6th July, 1949, deposited into Court Rs. 233 7 0 and on the 8th July, 1949, entered appearance and filed a written statement denying that they were in arrears with their rent or that their tenancy , had been ipso facto determined. The said proceedings came up for hearing on the 27th February, 1950, and the respondents not having appeared it was heard ex parte and an order was made directing the delivery of possession of the premises to the appellant on the 3rd May, 1950. In the meantime on the 31st March, 1960, the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950 (Act XVII of 1950) came into force. On the 29th May, 1950, the respondents filed an application in the trial Court under section 18 of the said Act for vacating the order for possession. On the 5th June, 1950, the trial Court made an order upon terms which, as set out in the respondents ' case, are as follows : "5 6 50. On consent all arrears of rent up to Jaistha 1357 B.S. with interest at 9% p.a. along with the costs of the suit including half Pleader 's fee amounting to Rs. 399 3 0 on consent in total to be paid by the defendants to the plaintiff by 4 7 50. The date fixed for payment and final orders. All proceedings and execution stayed until further orders. " The agreed amount having been paid the order for possession was vacated on the 4th July, 1950. The 536 order as recorded in the order sheet reads as follows: "4 7 50. Parties present as before. Defendant carries out the order of the learned Court, dated 5th June, 1950. Money deposited in Court as ordered. Accordingly order of decree for possession is vacated. Money in Court is allowed to be withdrawn by the plaintiff 's pleader under power. " The appellant on the 1st August, 1950, moved the High Court under section 115 of the Code of Civil Procedure for setting aside the order of the trial Court passed on the 4th July, 1950. While the application was pending before the High Court the West 'Bengal Premises Rent Control (Temporary Provisions) (Amendment) Act, 1950 (Act LXII of 1950) came into force on the 30th November, 1950. On the 9th April, 1951, the High Court following an earlier decision of another Bench of that Court in Rai Bahadur Atulya Dhan Banerjee vs Sudhangsu Bhusan Dutta(1) dismissed the application. On the 30th November, 1951, the High Court granted leave to the appellant to appeal to this Court and issued a certificate under the provisions of article 133 (1) (c) of the Constitution of India. As already stated, the proceedings out of which the present appeal arises were instituted under Chapter VII of the . Chapter VII of that Act which is intituled "Recovery of Possession of Immovable Property" allows the landlord, in certain circumstances, to "apply to the Small Cause Court for a summons against the occupant calling upon him to show cause on a day therein appointed why he should not be compelled to deliver up the property. " Section 43 provides that if the occupant does not appear at the time appointed or show cause to the contrary, the applicant landlord shall, if the Court is satisfied that he is entitled to apply under section 41, be entitled to an order addressed to a Bailiff of the Court directing (1) 537 him to give possession of the property to the applicant on such date as the Court thinks fib to name in such order. Although under the rules framed under the Act this application under section. 41 is initiated by a plaint there is no dispute that the proceeding is not a suit and the order for delivery of possession does not strictly speaking amount to a decree for recovery of possession [See Rai Meherbai Sorabji Master vs Pherozshaw Sorabji Gazdar(1)]. Indeed, section 1.9 of the Act peremptorily provides, inter alia, that the Small Causes Court shall have no jurisdiction in suits for recovery of immovable property. The only question for consideration, therefore, is whether section 18(1) of Act XVII of 1950 applies to an order for possession made under section 43 of the . Section 18(1) and the marginal note to that section run as follows: "18. Where any decree for recovery of posses Power of court to sion of any premises has been made |rescind or vary on the ground of default in decrees and orders payment of arrears of rent under or to give relief in the provisions of the West Bengal pending suits in Premises Rent Control (Temporary, certain cases Provisions) Act, 1948,but the possession of such premises has not been recovered from the tenant, the tenant may apply to the trial Court within sixty days of the coming into force of this Act for vacating the decree for ejectment against him and within such period no order for delivery of possession shall be made by any Court, nor if an application is made by the tenant under this sub section till the application has been dismissed under sub section (4). " In Rai Bahadur Atulya Dhan Banerjee vs Sudhangsu Bhusan Dutta it was held that the expression "decree for recovery of possession" in subsection (1) of section 18 includes an order for recovery of possession made under Chapter VII of the . This case (1) BOM. (2) 538 was followed, without further discussion, by different Benches of the same High Court in Dhanesh Prakash Pal vs Lalit Mohan Ghose (1), Mohon Lal Khettry v: Chuni Lal Khettry(2), Jethmull Sethia vs Aloke Ganguly (3) and also in the present case. Finally, the question was again considered by a larger Bench of the Calcutta High Court in Iswari Prosad Goenka vs N. B. Sen(4). The learned Judges agreed with the earlier decision in Rai Bahadur Atulya Dhan Banerjee vs Sudhangsu Bhusan Dutta (5). After hearing the able arguments I advanced before us and giving the most anxious consideration to the decisions in the cases mentioned above we are unable to accept the conclusion arrived at by them in those, cases as correct. Apart from the question whether the marginal note can at all be referred to in construing the provisions of a section of an Act, it is quite clear, on the authorities, that the marginal note cannot control the meaning of the body of the section if the language employed therein is clear and unambiguous. If the language of the section is clear then it may be that there is an accidental slip in the marginal note rather than that the marginal note is correct and the accidental slip is in the body of the section itself. Take for instance section 11 of the West Bengal Premises Rent Control Act, 1948. The section says that notwithstanding anything contained in certain Acts specified therein, "no order or decree for the recovery of possession of any premises shall be made so long as the tenant pays to the full extent the rent allowable by this Act and performs the conditions of the tenancy. " The marginal note to that section simply says: " No order for ejectment ordinarily to be made if rent paid at allowable rate." 'In the marginal note the words " or decree " do not find a place at all, a fact which clearly shows that the marginal note was ' not prepared carefully and that it was not a sure guide in the matter of the (1) (2) (I951) (3) (4) (5) 539 interpretation of the body of the section. We have, therefore, to read the words used in the body of section 18(1) of the 195O Act and if we find the meaning clear and unambiguous ' the marginal note should not be permitted to create an ambiguity in the section. Section 18 (1), as it stood on the 4th July, 1950, when the order for possession passed on the 27th February, 1950, was vacated, gave relief to a tenant against whom any decree for recovery of possession of any premises had been made on the ground of default in payment of arrears of rent under the provisions of the 1948 Act, provided that the possession of the premises had not been recovered from him. The relief given by this section is clearly against a decree for possession which "has been made" under the 1948 Act. The language of section 18 (1) of the 1950 Act and in particular the specific reference therein to the Act of 1948 take us back to that Act. Section II of the 1948 Act %refers " to order or decree for the recovery of possession of, any premises". The reference in the non obstante clause of section 11 to the , I 882, clearly indicates that the order for the recovery of possession refers to orders passed under section 43 of the last mentioned Act on applications made under section 41 thereof. Section 11 speaks of both " order " for the recovery of possession and " decree " for the recovery of possession. Therefore, there can remain no manner of doubt that the two words " order " and " decree " in section 11 connote two different things. This is further made clear by the use of two words " suit " or " proceeding " in section 12 of the 1948 Act. It is, thus, quite clear that in the 1948 Act " suit " is different from " proceeding" and " order " is different from " decree ". Therefore, in construing the 1948 Act there can be no occasion for giving any extended meaning to the word " decree" so as to include "order", for the two are distinctly and separately provided for. Section 18 (1) of Act XVII of 1950 does not refer to "decree" 70 540 simpliciter but to "any decree for recovery of possession of any premises on the ground of default in payment of arrears of rent under the provisions of" the 1948 Act. Turning then to that Act we find that a decree for possession on the ground of non payment of rent under that Act is treated distinctly from an order for possession on the ground of non payment of rent under the same Act. A decree for the recovery of possession within the meaning of that Act can, therefore, only mean a decree in a suit for recovery of possession and cannot cover an order for possession passed under section 43 on an application made under section 41 of the . In short, section 18(1) of Act XVII of 1950 expressly attracts the 1948 Act and under that Act there can be no necessity for giving an extended meaning to the word "decree", for "order " is sepa rately dealt with in that Act. It is said that whatever the word "decree" may mean in the 1948 Act it is immaterial for the purposes of construing Act XVII of 1950 for the Court has to ascertain the meaning of the word "decree" as used in section 18(1) of the last mentioned Act. It has been already stated that the language of section 18 (1) attracts the relevant provisions of the 1948 Act and, therefore, the word "decree" occurring in section 18(1) must necessarily be construed in the light of the 1948 Act and it is clear that so construed it cannot cover "order" for possession made under Chapter VII of the . Apart from ' that consideration, the question still remains: What does the word "decree" in section 18 (1) mean? That word has not been defined either in the 1948 Act or in Act XVII of 1950 or in the Bengal General Clauses Act. That word, however, has been defined in the Code of Civil Procedure, 1908, and, as there defined, it means the formal expression of an adjudication which determines the rights of the parties with regard to the matter in controversy in the suit which last word prima facie means a civil proceeding initiated by a plaint (section 26 and Order IV, rule 1, 541 Civil Procedure Code). This is the ordinary accepted meaning of the word " decree " and if that meaning is attributed to the word " decree " occurring in section 18(1) then clearly it cannot cover an order for possession passed under section 43 of the on an application made under section 41 of that Act. It is, however, urged that the word " decree" in section 18 (1) of Act XVII of 1950 should not be read in its strict sense. It is said that although the word "suit" ordinarily means a proceeding instituted by a plaint, it is also used in a wider sense so as to cover proceedings which are not instituted by a plaint and, therefore. , an adjudication in those proceedings which are also suits in that extended meaning may well be said to be a " decree". Reference is made to the explanation of sub section (1) of section 12 of Act XVII of 1950, which expressly provides that in the proviso to sub section (1) the term "suit" does not include proceeding under Chapter VII of the , and it is urged that this explanation inferentially means that the word " suit " occurring in the other sections of Act XVII of 1950 may include a proceeding under Chapter VII of the and, therefore, an order made on such a proceeding may be described as an adjudication in a suit and, therefore, a decree. It is not quite clear how this inference, even if it can be properly drawn, can have any bearing on the construction of the word "decree" in sub section (1) of section 18 of the Act XVII of 1960 where the word " suit " is not used at all. Be that as it may, the argument founded on the aforesaid inference sought to be drawn from the explanation to section 12 (1) of Act XVII of 1950 will clearly appear to be untenable when the provisions of that Act are closely scrutinised, for it will then be found that the word " suit" does not and was not intended to cover any proceeding under Chapter VII of the . Section 12 (1) prohibits the making of any order or decree for the 542 recovery of possession by any Court, notwithstanding anything to the contrary in any other Act or law. This sub section (1), standing by itself, means that no order for possession can be passed by the Presidency Small Cause Court notwithstanding the and no decree for possession can be made by any Court in any suit notwithstanding the Transfer of Property Act or the Contract Act or the Code of Civil Procedure, 1908. The proviso to sub section (1), however, saves "any suit for decree for such recovery of possession" against certain tenants or in certain circumstances. Therefore, it is clear that the proviso to sub section (1) of section 12 does not save proceedings under Chapter VII of the . The explanation to that sub section stating that the word "suit" in the proviso does not include a proceeding under Chapter VII of the appears to have been inserted out of abundant caution to put the position beyond any doubt. Section 16 of Act XVII of 1950 provides that notwithstanding anything contained in any other law a suit by a landlord against a tenant for recovery of possession of any premises to which the Act applies shall lie to the Courts as set out in Schedule B and that no other Court shall be competent to entertain or try such suit. According to Schedule B, where the premises are situate on land wholly within the ordinary original civil jurisdiction of the Calcutta High Court and when the rent does not exceed Rs. 500 per month, the Chief Judge of the Calcutta Court of Small Causes shall entertain and try such suit as a Court of the District Judge, provided that be shall be entitled to transfer the suit to any other Judge of that Court who shall try it as a Court of the Subordinate Judge. The result of sections 12 and 16 read with Schedule B is for all practical purposes to suspend the operation of Chapter VII of the in Calcutta for no one will take proceedings in which no order can be made. The effect of those sections is to confer a new jurisdiction on the 543 Chief Judge of the Calcutta Small Cause Court to entertain and try suits by landlords against tenants for recovery of possession of premises situate within the ordinary original civil jurisdiction of the Calcutta High Court when the monthly rent does not exceed Rs. 600. Thus after Act XVII of 1950 came into force the Calcutta Small Cause Court has ceased to have any power to pass an order for possession under Chapter VII of the and the Small Cause Court of Calcutta can, under that Act,, only pass a decree for possession in a suit Which is saved by the proviso to sub section (1) of section 12 and with regard to which a special jurisdiction is conferred on that Court by section 16 of that Act. That being the position, the word" suit " in none of the sections of Act XVII of 1950 can be said to have been used as including a proceeding under Chapter VII of the . Therefore, the reasoning advanced in support of attributing an extended meaning to the word "suit" and then inferentially to the word decree " in section 18 (1) cannot be sustained. It is next argued that if the word "decree" is construed strictly it will give rise to startling results in that poor tenants against whom orders for possesSion had been made under the 1948 Act will be deprived of the benefit of section 18 (1) while the wealthy tenants paying rents above Rs. 500 per month will get relief under that section and this will frustrate the intention of the Legislature. This argument proceeds on the assumption that the Legislature intended to give relief to all tenants against whom orders or decrees for possession had been made. The language of section 18 (1) clearly shows that the intention of the Legislature was to give relief only to certain tenants in certain circumstances. In the first place relief is given only with respect to decree for possession made on the specified ground and not with respect to a decree for possession made on any other ground. In the next place relief is given only when the possession of the premises in respect of which a 544 decree for possession had been made had not been made over by the tenant. Thus tenants against whom a decree for possession had been made on grounds other than the ground specified. in the subs section and even tenants against whom a decree for possession had been made on the specified ground but who had, voluntarily or otherwise, delivered possession of the premises get no relief under section 18 (1). An order for possession is made by the Presidency Small Cause Court under Section 43 on a summary application under section 41 and the order directs the Bailiff of the Court to deliver possession to the applicant. This order for the recovery of possession which under section 37 of the is final and conclusive and from which there is no appeal or a new trial under section 38 of that Act does not ordinarily take much time to be obtained or to be carried out and certainly much less than what is taken to obtain a decree for possession in a suit and to execute such decree, because both the decree for possession in a suit and the order for execution thereof are subject to appeal. The Legislature may well have thought that cases where orders for possession had been made under Chapter VII of the with respect to premises which were situate within the small area of the ordinary original civil jurisdiction of the Calcutta High Court and which, in spite of such orders, were still in the possession of the tenants at the date of the commencement of Act XVII of 1950 would be few in number as compared to the number of cases where decrees for possession had been made with respect to premises which were situate within a very much larger area and which were still in the possession of the tenants and, therefore, did not think fit to provide for those few cases. It must always be borne in mind, as said by Lord Halsbury in Commissioner for Special Purposes of Income Tax vs Pemsel (1), that it is not competent to any Court to proceed upon the assumption that the Legislature L. R. ; at P. 549. 545 has made a mistake. The Court must proceed on the footing that the Legislature intended what it has said. Even if there is some defect in the phraseology used by the Legislature the Court cannot, as pointed out in Crawford vs Spooner(1), aid the Legislature 's defective phrasing of an Act or add and amend or, by construction, make up deficiencies which are left in the Act. Even where there is a casus omissus, it is, as said by Lord Russell of Killowen in Hansraj Gupta vs Official Liquidator of Dehra Dun Mussoorie Electric Tramway Co., Ltd. (2), for others than the Courts to remedy the defect. In our view it is not right to give to the word " decree" a meaning other than its ordinary accepted meaning and we are bound to say, in spite of our profound respect for the opinions of the learned Judges who decided them, that the several cases relied on by the respondent were not correctly decided. Reference was made, in, course of argument, to section 6 of the West Bengal Act LXII of 1950. That section refers to orders or decrees made between the commencement of Act XVII of 1950 and Act LXII of 1950, i.e., between the 30th March, 1950, and the 30th November, 1950, and cannot have any application to the order for possession made in this case on the 27th February, 1950. For reasons stated above this appeal must be allowed and the order made by the High Court should be set aside and the respondents ' application under section 18 (1) of Act XVII of 1950 should be dismissed and we order accordingly. In the circumstances of this case we make no order as to costs except that the parties should bear their own costs throughout. Appeal allowed. Agent for the respondent : Sukumar Ghose. (1) 6 Moo. P.C. I; 4 M.I.A. 179. (2) (1933) L.R. 60 I.A. I3; A.I.R. 1933 P.C 63.

The expression " decree for recovery of possession " in section 18 (1), of the West Bengal Premises Rent Control (Temporary Provisions) Act (Act XVII of 1950) does not include an order for recovery of possession made under section 43 'of the , and a person against whom an order for 534 recovery of possession has been passed under section 43 of the , is not therefore entitled to claim relief under the provisions of section 18 (1) of Act XVII of 1950. Rai Bahadur Atulya Dhan Banerjee vs Sudhangsu Bhusan Dutta ([1951] 5 , Dhanesh Prokash Pal vs Lalit Mohan Ghosh ([1951] , Mohan Lal Khettry vs Chuni Lal Khettry ([1951] Jethmull Sethia vs Aloke Ganguly ([19511 , Iswari Prosad Goenka vs N. B. Sen ([19511 overruled. In construing a statute it is not competent to any court to proceed upon the assumption that the Legislature has made a mistake and even if there is some defect in the phraseology used by the Legislature, the Court cannot aid the defective phrasing of an Act or add and amend, or by construction, make up deficiencies which are left in the Act. Commissioner for Special Purposes of Income Tax vs Pemsel (11891] A.C. 531); Crawford vs Spooner ([1846 51] 4 M.I.A. 179) and Hansraj Gupta vs Official Liquidator of Dehra Dun Mussourie Electric Tramway Co. Ltd. ([1933] 60 I.A. 13) referred to.

303 of 1960. Under Article 32 of the Constitution of India for the enforcement of Fundamental Rights. C. K. Daphtary, Solicitor General of India, N. Sharma, section C. Nath and R. Gopalakrisnan, 'for the Petitioner. M. C. Setalvad, Attorney General `for India and Naunit Lal, for the Respondents. September 29. The Judgment of Sinha C. J., section K. Das and Rajagopala Ayyangar was delivered by S.K. DAS. This writ petition by one Mannalal Jain was originally filed on October 17, 1960, and the order complained of was dated September 13, 1960. This was an order made by the Deputy Commissioner, Kamrup Gauhati, rejecting an application made by the petitioner for the grant of a license for the year 1960 for dealing 'in rice and paddy under the relevant provisions of the Assam Foodgrains (Licensing and Control) Order, 1960. This writ petition was put up for 939 hearing in this Court on February 2, 1961. The hearing was, however, adjourned sine die, because it was stated before us that the period of licence for 1960 had already expired and a fresh application would have to be made for a license for 1961. A fresh application was accordingly made by the petitioner on February 4, 1961. But before that date: a fresh Assam Foodgrains (Licensing, and Control) Order, 1961 was made by the Governor of Assam and the application made by the Petitioner had to be dealt with under the new Order. No order having been made on this fresh application by the Deputy Commissioner, the petitioner moved this Court by means of a petition (C.M.P. No. 850 of 1961) asking for certain reliefs, one of which was that the respondents, namely, the licensing authorities, should be directed to consider the application of the petitioner and grant him a license. On April II, 1961 an order was made rejecting the application of the petitioner. This order which is impugned before us was in these terms. Having regard to the existing licenses in these areas (Mangaldai and Gauhati), and the quantity of foodgrains available therein, any further license would be superfluous." When the petition was again put up for hearing on May 1, 1961 the petitioner asked for time to amend his original, petition, which related to the order refusing to grant him a license for 1960. This amendment became necessary by reason of the subsequent order passed on April 11, 1961, quoted earlier, by which the petitioner 's application for a license for 1961 was rejected. This amendment was allowed. Therefore, we have now to deal with the writ petition as amended by the petition dated May 5, 1961 (C.M.P. No. 1140. of 1961). It is necessary now to state the relevant facts out of which the petition has arisen. The petitioner states that he is an Indian citizen carrying on a business dealing in rice and paddy in the district of 940 Kamrup in the State of Assam. In 1955 was enacted the (Act 10 of 1955). In exercise of the powers conferred by section 3 of the said Act, read with a notification by which the said powers were delegated by the Central Government to the Government of Assam, the latter Government made an Order called the Assam Foodgrains (Licensing and Control) Order. The result of this was that no dealing in rice and paddy in wholesale quantities was permissible unless the petitioner obtained a, license from the relevant licensing authority. The petitioner states that he obtained such a license in 1958. This license expired on December 31, 1958. The case of the petitioner is that in 1959 also he carried on his business though there is some dispute as to whether he obtained a license for that year. On November 26, 1959, the petitioner received a letter from the office of the Deputy Director of Supply, Gauhati, which said that his license would not be renewed after December 31, 1959. This communication, it is stated, was the result of a decision taken by the Government of Assam on the advice of a body called the Food Advisory Council to give a right of monopoly procurement of paddy to a cooperative society in the district of Kamrup known as the Assam Co. operative Apex Marketing Society Ltd. (respondent No. 6 before us). In a letter dated November 13, 1959, the Director of Sup ply, Assam, indicated the policy to be followed to give effect to the decision aforesaid in these terms "The right of monopoly procurement in respect of Kamrup district including Mangaldai Sub division, Taxpur Sub division, Cachar district, Nowgong district including United Mikir and North Cachar Hills and North Lakhimpur Sub division has been given to the Co operative Apex Marketing Society. The Society will procure paddy from the 'growers through various service Co operative Societies spread over the district or sub division. They 941 will procure all available surplus paddy and deliver to Supply Department the quantity required for the buffer stock for those areas. Any paddy procured by them which is not required by us may be delivered to the mills. " A copy of the letter was forwarded to all licensing authorities. on January 5, 1960, the Assam Foodgrains (Licensing and Control) Order, 1960, came into force. This replaced the earlier Order of 1958. Clause 5 of the 1960 Order was in these terms: 5. Maiters to be taken into consideration for granting a license. In granting or refusing a license under this Order, the licensing authority shall among other matters have regard to the following, namely: (a) the stock of foodgrains available in the locality for which the license is required; (b) the number of persons who have applied for and/or been granted licenser, in respect of the foodgrains under this Order in the locality (c) the business ordinarily carried on by the applicant; and (d) the past activities of the applicant as a licensee or business man/firm: Provided that the State Government may from time to time modify the conditions for granting a license. " On January 28, 1960 the petitioner made his application for a license for the year 1960. This application was rejected by an order dated February 17, 1960. The reason given for the rejection was in these terms: "You are hereby informed that as ;the Co operative Apex Marketing Society has been given the right of monopoly purchase in the Kamrup district this year, your case. cannot be considered for issue of the license. 942 This reason was obviously based on the decision as to monopoly procurement, which the Government of Assam had adopted. Against this order the petitioner moved the High Court of Assam by means of a writ petition under article 226, of the Constitution. The High Court allowed the petition mainly on the; ground that the application, of the petitioner for a license for, the year 1960 was not considered on merits by the licensing authority in accordance with the provisions of el. 5 of the Assam Foodgrains (Licensing and Control) Order, 1960. The High Court did not go into the larger question whether the State could or could not create a monopoly in the matter of procurement of paddy under the said provisions by means of executive instructions issued to the licensing authorities. It however, quashed, the order dated February 17, 1960 and issued a writ of mandamus directing the licensing authority to consider the application of the petitioner on merits and in accordance with the provisions of the aforesaid Control Order. Till June 7, 1960 no order was passed by the licensing authority, and on that date the petitioner made two applications to the High Court, one for directing the licensing authority to grant,, him & license for 1960 and the other for taking action, for contempt of court. A notice of these applications, it is stated, was served on the respondents. On June 8, 1960 the licensing authority made another order refusing to grant a license to the petitioner. This order stated that "as the Assam Co operative Apex Marketing Society Ltd., had already been granted a license to deal in rice and paddy., with its branches spread all over the district, it was considered unnecessary to grant further dealing licenses to individual dealers for the same area". On June 9, 1960 the applications earlier made by the petitioner to the High Court on June 7, 1960 were withdrawn and a fresh application was made on June 15, 1960, which, was directed against the order dated June 8, 1960. On 943 August 10, 1960 the High Court again set aside the order and directed the licensing authority to act independently of instructions received from the Government and, to apply its mind to the merits of the application and, decide it in accordance with the relevant provisions of the Assam Foodgrains (Licensing and Control) Order, 1960. Again, no orders were made by the licensing authority till September 8, 1960 in accordance with the directions of the High Court, and the petitioner made two applications on that date: one for enforcing the direction of the High Court, and the other for initiating proceedings in contempt. These applications were admitted and it is stated that notices were served on the respondents, including the licensing authority, on that very date. On September 13, 1960 the licensing authority made another order, again rejecting the application of the petitioner. This order stated inter alia: "For the areas for which the application have been made the Assam Co operative Apex Marketing Society Ltd., has earlier. applied for and has been granted license. This is as relevant consideration under Clause 5 (b) of the Assam Foodgrains (Licensing and Control Order, 1960. The stock of foodgrains avail able in the area can easily be procured by the party already given license. Being a on operative, it has better facility in this respect. As such, I do not find it necessary to grant license to the applicant. The petition is, therefore, rejected". This time instead of going to the High Court of Assam, the petitioner came here and filed his writ petition on October 17, 1960 (Writ Petition No. 303 of 1960). Thereafter, certain proceeding ,took place in this Court to which we have earlier referred in the first paragraph of this judgment The amended writ petition as it now stands is directed against the order of the licensing authority dated April 11, 1961, by which it rejected the 944 application of the petitioner for a license for 1961. The provisions of the Assam Foodgrains (Licensing and Control) Order 1960 are no longer relevant, because a fresh Order called the Assam Foodgrains (Licensing and Control) Order, 19,61, was made by the Governor of Assam. We shall, hereinafter call this the Control Order, 1961. It is necessary 'to read here cl. 5 of the Control Order, 1961. Matters to be taken into consideration for granting a license. In granting or refusing a license under this Order, the licensing authority shall, among. other matters, have regard to the following, namely: (a) the stock of foodgrains available in the locality for which the license is required; (b) the number of persons who have applied for and those who have been granted licenses in respect of the foodgrains under this Order in the locality; (c) the business ordinarily carried on by the applicant; (d) the past activities of the applicant as a licensee or business man/firm; and (e) whether the applicant is a cooperative society. It should be noticed that the proviso to old el. 5 was omitted and a new sub cl. (e) was added. This sub clause enables the licensing authority, in granting or refusing a license, to have regard to the consideration whether the applicant is a co operative society. To complete the statement of facts, it may perhaps be observed that on November 10, 1960, the High Court rejected the application for proceeding against the opposite, parties by way of contempt, mainly on the ground. that the order made on September 13, 1960, was not before it. On behalf of the petitioner the order dated April 11, 1961, has been impugned on two main 945 grounds. The first ground of attack is that sub cl.(e) of cl.5 of the control Order, 1961 is ultra vires,because it goes beyond the powers granted to the State Government under section 3 read with section 5 of the '. The second ground of attack is that 'even if sub cl. (e) of cl. 5 of the Control Order. 1961, is intra vires being within the powers granted to the State Government, it merely allows the licensing authority to take into consideration, among, other relevant matters, the circumstance that the applicant for a licence is a co operative society; it does not say that a monopoly right of procurement Should be given in favour of a co operative society by excluding all. Others; therefore, it was not open to the, licensing authority to proceed on the footing as if that subclause bad created a right of monopoly in favour of co operatives. The argument. is that in the present case, the licensing authority instead of applying its mind to the provisions of cl. 5 of the Control Order, 1961, went by the instructions issued by the State Government to grant a. right of ,monopoly to cooperative societies and based its order on such, instructions. , in spite ' of directions to the contrary given by the High Court on earlier applications made by the petitioner. In other words, it is contended that the impugned order was a mere" colourable exercise of power in the sense that instead of exercising the powers in accordance with the provisions of law by which the licensing authority had to be guided, it acted in, accordance with the instructions of the State Government and granted 'a monopoly in favour of co operative, societies, such monopoly not being contemplated by the provisions of cl. 5 of the Control Order, 1961; therefore., the impugned order was bad being without any legal authority or jurisdiction, and as it took away the right of the petitioner to carry on his trade, and furthermore made a discrimination against him for the purpose of granting a monopoly to respondent No. 6 not contemplated by law, it violated the 946 petitioner 's rights under articles 14 and 19 of the Constitution. He is accordingly entitled. to come. to this Court under article 32 of the Constitution to have the order quashed. The petitioner has also claimed that for the same reasons, the grant of a license in favour of respondent No. 6 should also be quashed. On behalf of the respondents, the State of Assam, its officers, and the Assam Co operative Apex Marketing Society Ltd. (respondent No. 6), it has been urged that neither of the aforesaid two grounds of attack is valid. On their behalf the argument is that sub cl. (e) of cl, 5 of the Control Order, 1961, is within the authority and power granted to the State Government under section 3 read with a. 5 of the . Secondly, it is contended that no monopoly has been granted to the Assam Co operative Apex Marketing Society Ltd., and the order of the licensing authority dated April 11, 1961 is based on the considerations referred to in sub cls. (a) and (b) of el. 5 of the Control Order, 1961, and cannot be assailed on a petition under article 32 of the Constitution. We proceed now to a consideration of the grounds of attack and the replies thereto. As to the first ground of attack it must be made clear at the very outset that the vires of the have not been challenged before us. What has been contended before us is that s.3 of the Act gives, certain powers to the Central Government, which powers the Central Government has delegated the State Government of Assam. These powers it is contended, do not authorise the insertion of sub cl. (e) of cl. 5 of the Control Order, 1961; in other words the argument is that whether the applicant for a licence is a, co operative Society or not has no relevance whatsoever to the objects fur which section 3 grants the powers to the Central Government or its delegate to make certain Orders. Sub section (1) of a. 3 is relevant to this argument and reads: 947 "3 (1) If the Central Government is of *onion that it is necessary or expedient an to do for maintaining or increasing supplies of my 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 section 3 which we need not read enumerates the various categories of Orders which can be made in exercise of the powers conferred by sub s.(1), but without prejudice to the generality of those powers. Now, the argument before us is that the, powers under a. 3 can be exercised when the Central Government or its delegate is of opinion that it it; necessary or expedient to exercise the powers to achieve two objects: (a) for maintaining or increasing supplies of any essential commodity, or (b) for securing their equitable distribution and availability at fair prices. It is contended that the circumstance whether the applicant for a licence is a co operative society or not has no connection what so ever with the aforesaid two objects and therefore, sub cl. (e) of cl.5 of the Control Order, 1961 is not within the powers granted by a. 3 of the Act. We cannot accept this argument in the very broad terms in which it has been stated. We are astisfied that cl. 5 of the Control Order, 1961 does not provide for a monopoly in favour of cooperative societies. The clause enumerates five matters and states that the licensing authority shall have regard to those matters in granting or refusing a license. The five matters enumerated in the clause are not exhaustive of the matters which the licensing authority may consider; because the clause says that the matters enumerated therein are five ""among other matters" which the licensing authority may consider. Obviously enough it is open to Ye licensing authority to 948 consider all matters relevant to, the 'grant or refusal of a license and the; five matters enumerated in the clause merely highlight some of those matters. All that can be said is that sub cl. (e) enables the licensing authority to,; prefer a co operative society in certain circumstances in the matter of granting a license; in other words, there may be cases or localities : where the considerations set out in sub cl. (e) may override other considerations, in the matter of granting a license. We do not think that sub cl. (e) has any more far reaching effect. Indeed the: learned Attorney General appearing for : the respondents conceded that sub cl. (e) of cl. 45 did not have the effect of creating a monopoly in favour of co operative societies. Proceeding, therefore, on the footing that sub cl. (e) of el. 5 does not provide for the creation of a monopoly, can it be said that it is out. ,side the powers conferred. on the State Government by section 3 of ' the ? It is no disputed before us that sub cls.(a) (a) to (d)fall within the powers conferred by section 3. Matters such as the stock of foodgrains, available in the locality for which the license is required, the number, Of persons who have applied for and those who have been granted licenses in the locality, the business ordinarily carried on by the applicant, and the 'Past activities of the applicant as a licensee or businessman, are undoubtedly matter& which have; relation to the two objects mentioned in section 3. Can it be. said that the fifth matter mentioned in sub cl. (e) viz., whether the applicant is a co operative society is completely ' unrelated to those two, objects? We are unable to say that it is. In the counter affidavit filed on. behalf of the respondents it has; been stated that cooperative societies have better facilities for procuring foodgrains and are in a position to ensure scheduled prices to the farmers who, grow paddy. It has been further stated that amongst the cooperative societies, axe primary, societies which 949 consist of the growers of paddy there are also cooperative societies called supply co operatives which are in a position to eliminate middle man 's profits. In para. 4 it was stated that the National Development Council decided that the State should take over wholesale trade in foodgrains with a view to maintaining price levels which are fair to the producer and the consumer and reduce, to the minimum the disparity between the prices received by the farmer and the prices paid by the consumer throughout the year. It was also decided that an adequate number of primary marketing societies should be set up and linked with village cooperatives which should serve as agencies for collection and sale of foodgrains at assured price,% at the village level. The affidavit then stated In view of the decision of the National Development, Council, the Government of Assam in consultation with their State Food Advisory Council decided that in making procurement of rice and paddy in the State, preference should be given to the co operative societies wherever they have resources and facilities. We are of the view that by reason of the position which co operative societies may occupy in the village economy of a particular area,, it cannot be laid down as a general proposition that sub cl.(e) of cl 5 of of the Control Order, 1961, is unrelated to the objects mentioned in section 3 of the . There may be places or areas where co operative societies are in a better position for maintaining or increasing supplies of rice and., paddy and even, for securing their equitable distribution and availability at fair prices. We must, therefore repel the very broadly stated contention of the learned counsel for the petitioner that sub cl. (e) of cl. 5 of the Control Order, 1961, can have no relation whatsoever to the two objects mentioned in section 3 of the . On behalf of them petitioner reliance 950 was placed on the decision in Ramanlal Nagardas vs M. section Palnitkar (1). That was a case in which the validity of State action in entrusting wholesale distribution of sugar which is an essential commodity under the Essential Com modities Act, 1955, to Co operative Societies only and excluding other dealers holding similar licenses like the co operative 'societies from such distribution, was challenged and adore for consideration. It was held that a State could make a classification for the purpose of@ achieving particular legislative objects but the classification must satisfy two conditions : (1) it must be founded on intelligible differentia, and (2) the differentia must have a rational relation to the objects sought to be achieved. The question was considered from the point of view of article 14 of the Constitution and it was held that the action of the State Government in entrusting wholesale distribution of sugar to cooperative societies to the exclusion of other licence holders amounted to a discrimination which violated the right guaranteed under article 14. The principles underlying article 14 of the Constitu tion are now well settled and have been enunciated and explained in a number of decisions of this Court and we consider it unnecessary to refer to those principles in detail. In the case under our consideration no discrimination has been made between one class of license holders and another class of license holders as in the case of Ramanlal Nagardas V. M. section Palnitkar (1). What has happened in the present ' case is that licenses have been granted only to cooperative societies and a license has been denied to the petitioner, the licensing authority proceeding on the footing that a monopoly must be created in favour of co operative societies. A discrimination has indeed taken place 'as against the petitioner, a discrimination which is not justified by the 'Provisions of cl. 5 of the Control Order, 1961. In dealing with the application of the petitioner the licensing authority (1) A. I. R. 1961 Guj. 38. 951 has made, a, discrimination which is met justified by 5. That would take us to the second argument of the learned counsel for the petitioner, but on his first argument the decision in Ramanlal Nagardas vs M. section Palnitkar (1) is of no assistance. Sub clause (e) of el. 5, we have already stated, enables the licensing authority to give preference to a co operative society in certain circumstances; but it does not create a monopoly in favour ;of co operative societies. The preference given has a reasonable relation to the objects of the legislation set out in section 3 of the Act; therefore, sub cl. (e) of cl. 5 of the Control Order, 1961, cannot be held to be bad on the ground of class legislation but the passing of an order under the sub clause for a purpose not contemplated by it will amount to discrimination and denial of the guarantee of equal protection of the law. This brings us to the second argument urged on behalf of the petitioner and here we think that the learned counsel for the petitioner is on much surer ground. It was open to the licensing authority to give preference to co operative societies, if it was of the opinion that granting a license to a co operative society in a particular locality would facilitate the objects of section 3 of the Act. This is not what the licensing authority did. He repeatedly refused a license to the petitioner, for the only reason and purpose of granting a monopoly to co operative societies. In other words, the discrimination that has been made by the licensing authority is really in the administration of the law. It has been administered in a discriminatory, manner and for the purpose of achieving an ulterior object, namely, the creation of a monopoly in favour of co operatives, an object which, clearly enough, is not within sub cl. (e) of el. 5 of the Control Order, 1961. We have quoted earlier the various orders which the, licensing authority had passed. Those orders clearly show that the licensing authority refused a licence to the (1) A.I.R. 1961 Guj. 952 petitioner not on grounds referred to in sub cls.(a) and (b) of cl. 5 but on the ground ' that the State Government had decided to introduce a right of monopoly procurement of paddy in favour of co operative societies and therefore, no licenses should be granted to individual dealers other than cooperative societies. Judged against the background of facts to 'which we have earlier referred in this Judgment, the impugned order dated April 11, 1961 appears to us to have been based on the same ground, namely, the creation of a monopoly in favour of co operatives, even though the order refers to existing licenses and the quantity of foodgrains available in the locality. In the course of the hearing before us, the case was adjourned in order to give the parties an opportunity of filing necessary affidavits to show whether individual dealers other than co operatives have been completely excluded in the whole of the State in the matter of dealing in paddy. The affidavits show that private dealers have been completely excluded. In the affidavit filed on behalf of respondent No. 1, it has been stated in para. 4: "It is not denied that in the year 1961 licenses for the procurement of paddy have been issued to the co operatives in all the paddy producing districts in Assam." To show however that no monopoly hag been created in favour of a particular co operative society like respondent No. 6, it has been stated that a number of co operative societies have been or are being granted licenses for the procurement of paddy. ' In our view these statements in the affidavits filed on behalf of the respondents show only one and one object viz., creation of a monopoly in favour of cooperatives. To achieve that object the State Government has resorted to an indirect method. Instead of making an Order authorising such monopoly (if the State was 953 competent to make such an Order under the , as to which we express no opinion), it has chosen to adopt the indirect method of issuing instructions to the licensing authorities in all the districts to grant licenses to co operatives only. The vice of the impugned order lies in the licensing authority accepting such instructions and passing an order in accordance there with. The duty of the licensing authority was to pass orders in accordance with el. 5 of the Control Order, 1961. Instead of doing that. it passed an order in accordance with the instructions given to it on behalf of the State Government, instructions which appear to us to be not in consonance with sub cl.(e) of el. 5; because sub cl. (e) contemplates a preference to co operative societies in certain circumstances, but not a monopoly in their favour. We accordingly hold that the impugned order is bad as violating the rights of the petitioner guaranteed under articles 14 and 19 of the Constitution. We must, therefore, quash the order of the licensing authority dated April 11, 1961. We must also quash the order by which the licensing authority granted a licence in favour of respondent No. 6. The licensing authority must now consider the application of the petitioner for a license for the year 1961 on merits along with the application , of respondent No. 6 and such other applications as may be still pending. In dealing with these applications the licensing authority must have regard to the provisions of cl. 5 of the Control Order, 1961, and such other provisions of law as have a bearing on them, in the light of the observations made in this judgment. it would be the duty of the licensing authority to ignore all instructions which are not in consonance with the provisions of law by which it is to be guided As the year 1961 will come to an end within a few months. , the applications should be dealt with as expeditiously as possible so that the right of the petitioner may 954 not be rendered infructuous by reason of the delay made in disposing of the applications. Before we part with this case we express our deep concern over the manner in which the State Government or its officers have issued instructions in the matter of granting ' of licenses, instructions which clearly ' enough are not in consonance with the provisions of law governing the grant of such licenses. We doubt the wisdom of issuing executive instructions in matters which are governed provisions of law; even if it be considered necessary to issue instructions in such a matter,, the instructions cannot be so 'framed or utilised as to override the provisions of law. Such a method 'Will destroy the very basis of the rule of law and strike at the very root of orderly administration of law. We have thought it necessary to refer to this matter because we feel that the instructions which the State Government or its officers have issued in the matter of granting of licenses for the procurement of paddy are not in consonance with the provisions of el. 5 of the Control Order 1961, In the result the petition is allowed with costs and the necessary orders should now issue as directed above. SARKAR J. The petitioner is a citizen of India and carries on business as dealer in rice and paddy in the State of Assam. Since 1958, dealing in rice and paddy was controlled in that State by Orders made by the State Government from time to time under the by virtue of powers delegated to it by the Central Government under section 5 of that Act. These Orders here.after called Licensing Orders,, provided that no person could engage in any purchase, sale or storage for sale of any foodgrains, which included rice and paddy in wholesale quantities except, under and in accordance with the terms and condition of a licence business involving issued thereunder. Purchase or, sale in wholesale quantities was defined 955 as purchase, or sale of quantities exceeding ten maunds in any one transaction. The petitioner had obtained a license to deal in paddy for the year 1958. It is not clear whether he had obtained a license to do so for 1959. With these years, however, this case is not concerned. On January 28, 1960, the petitioner had applied under the Licensing Order then in force for a license to deal in paddy in Kamrup district: of Assam for the year 1960. His application was refused by an order made on February 17, 1960 on the ground that it could not be considered as the Co operative Apex Marketing Society had been given the right of monopoly purchase in Kamrup district. The petitioner then moved the High Court of Assam under article 226 of the Constitution to quash this order. On April 27, 1960, the High Court delivered judgment quashing the order on the ground that the authority concerned was bound to ;consider the petitioner 's application for licence and had failed to do so. The High Court issued a writ of mandamus directing that the petitioner 's application be considered on its merits. As the licensing authority did not consider the petitioner 's application till June 7 1960, the latter on that date moved the High Court again for enforcement of the writ issued. On receipt of the notice this motion, the licensing authority passed an order on June 8, 1960 again refusing to grant the petitioner the licence. This order, stated, "Your petition is considered. As the Assam co operative Marketing Society has already been ' granted a licence to deal in rice and paddy with branches spread all over this district, it is considered unnecessary to grant further dealing licences to individual dealers for the same area. Hence the petition is rejected. " The petitioner thereupon dropped his motion to the High, Court of Assam of June 7, 1960 and moved the High Court afresh under article 226 against the order of June 8, 1960 refusing him the licence 956 and the High Court on August 8, 1960, quashed it on the ground that the licensing authority had to act in a quasi judicial capacity and that it bad decided the case on the instructions of the State Government without considering for itself the merits of the case in terms of the Licensing Order. The authority was again directed to decide the case in a quasijudicial capacity. The licensing authority not having taken up for decision the petitioner 's case for the grant of licence as directed by the High Court, he moved. the High Court on September 8, 1960 for appropriate reliefs. On receipt of the notice of this motion the licensing authority passed an order on September 13, 1960, again refusing to grant licence to the petitioner and certain other private dealers. The order stated, "For the areas for which the applications have been made the. Assam Co operative Apex Marketing Society has earlier applied for and has been granted licence. This is a relevant consideration under el. 5(b) of the Assam Foodgrains (Licensing and Control) Order, 1960. The stock of foodgrains available in the area can easily be procured by the party already given the licence. Being a Co operative Society it has better facility in this respect. As such I do not find it necessary to grant licence to these applicants. The petitions are therefore rejected". Thereupon the High Court on November 10, 1960, made an order on the petitioner 's aforesaid motion of September 8, 1960 discharging the rule as the order asked for had been made. It observed that the order of September 13, 1960 was not before it and it was competent to say whether that order was in consonance with its order of August 8, 1960. It also observed that it did not find sufficient reason to take any action against the licensing authority for the delay in the matter of the disposal of the application for licence. Before proceeding further I would like to point out that the Assam Foodgrains (Licensing and 957 Control) Order, 1960 being the Licensing Order by which the petitioner 's application for licence for 1960 was governed did not contain any provision enabling any preference to be given to a co operative society in the matter of the grant of licence. I now come to the present petition. It was ;moved in this Court by the petitioner under article 32 of the Constitution challenging the validity of the order of the Licensing authority dated September 13, 1960, and asking that the licence granted to the Assam Co operative Apex Marketing Society be declared illegal and for an order directing the licensing authority to consider the applications for licences according to the provisions of,the Licensing Order, 1960. The petition came in for hearing on February 2, 1961. By that date the year for which the petitioner had asked for a licence had expired and the Licensing Order, 1960 had been replaced by another Order of 1961. In the result the petition bad become substantially infructuous. The petitioner, therefore, suggested to this Court that he would make an application for a licence for the year 1961 and in the meantime the petition might stand adjourned. An order was thereupon made adjourning the petition sine die. Thereafter the petitioner on February 4, 1961, made a fresh application for licence for dealing in paddy for the year 1961. An order was made by the licensing authority on this application on April 1 1, 1961, in these terms : "Having regard to the existing licences in these areas (Mangaldai and Gauhati), and the quantity of food grains available therein,an further licence,, would be superfluous." In the result the petitioner was refused licence for the year 1961. Thereafter, the petitioner under orders obtained from this Court amended hi,$ petition and now seeks to challenge the. order of April 11, 1961. The respondents to this petition axe the State of Assam and some of its officers including the licensing, authority 958 concerned, as also. the Assam Co operative Apex Marketing Society, hereafter called the Apex Society. As I have already said, the application for licence for 1961 was governed by the Licensing Order, 1961. The dispute in this case mainly turns on cl. (e) of paragraph 5 of this Order. That paragraph is in these terms: .LM15 "In granting or refusing a licence under this Order, the licensing authority shall, among other matters, have regard to the following, namely: (a) the stock of foodgrains available in the locality for which the licence is required; (b) the number of persons who have applied for and those who, have been granted licences in respect of the foodgrains under this Order in the locality; (c) the business ordinarily carried on by the applicants (d) the past activities of the applicant as a licensee or business man/firm; and (e) whether the applicant is a cooperative society. " It is not in dispute that in the areas to which the Licensing Order 1961, had been applied, licences to deal in paddy had been given to: various Co operative Societies which were subsidiaries of the Apex Society and no licence had been given to any private dealer. The respondents say that these grants were duly made under cl. (e) of paragraph 5 of the Licensing Order, 1961. It is this action which forms the main grievance of the ,petitioner. He puts his contentions on two grounds. First, he says that cl. (e) of paragraph 5 of the Licensing Order 1961 is ultra vires as it has no 959 relation, to, the object of the under which it was made. Secondly, he says that in any event the Order has been applied. in a discriminatory manner and with a view to create a monopoly in favour of the Apex Society to deal in paddy and the petitioner 's fundamental rights under articles 19(1)(g) and 14 have thereby been violated. It does not seem to me that either of these two contentions is well founded. I shall first consider whether paragraph 5(e) of the Order is ultra vires the Act. Now it is important to note ,that the validity of the Act is not challenged. It would follow that if the Order made under the Act is not ultra vires, it would be perfectly valid. It is section 3 of the Act which enables the Orders to be made. That section so far as relevant is in these terms 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, sup ply and distribution thereof and trade and commerce therein. The object of the Act, therefore, is to maintain or increase the supplies of essential commodities which include foodgrains and to secure their equitable distribution and availability at fair prices. Clause (e0 of paragraph 5 of the Licensing Order, 1961 certainly allows a co operative society to be Preferred. in the matter of a grant of licence. The question then is, would the object of the, Act be achieved if the trade in paddy is given to co operative societies ? I think it would. A co operative society is one which has as its object the promotion of the, economic interests of its members in accordance with co operative principles : see section 4 of the 960 . A society carries on business in accordance with co operative principles when it trades with its own members, the profit motive not being paramount in such business. When, therefore, a licence to purchase paddy is given to a co operative society of growers, what happens is that the seller sells to a body of which he is a member. The result is the virtual elimination of the middleman and a consequential reduction in the price. The following observation,% from the judgment of this Court in Narendra Kumar vs The Union of India (1) are, to my mind, very apposite in the present context : "That middleman 's profits increase the price of goods which the consumer has to pay is axiomatic ' " (p. 389). ,,It has therefore been the endeavour at least in modern times for those responsible for social control to keep middlemen 's activities to the minimum and to replace them largely by co operative sale societies of producers and co operative sale societies of the consumers." (p. 390). Therefore, I feel no doubt that if the purchase of paddy is left to growers co operatives and that is what cl. (e) of paragraph 5 aims at rice,, which is husked paddy, can reasonably be expected to be made available to the consumers at a fair price. That would serve the object of the Act and the clause cannot, therefore, be said to be ultra vires the Act. Then it is said that cl. (e) of paragraph 5 would result in creating a monopoly in favour of co operative societies and that would be illegal and also outside the object of the Act. This contention also seems to me to be ill founded. It seems to me that if paragraph 5 had contained only cl. (e) directing preference being given to co operative societies in the matter of grant of licences and that is the basis on which the present contention is advanced that would not have made it bad. The question (1) 961 of creating a monopoly does not really arise in such a case. The Order may then allow one class only, namely, co operative societies, to do the business. That would, as I have already stated, advance the object of the Act. It would also however amount to a prohibition of others doing the business. The only question then would be whether such prohibition would be reasonable under article 19(6). That is how the matter appears to have been considered by this Court in two cases to which I will now refer. The first is the case of Narendra Kumar(1) earlier mentioned. There an order called the "Non ferrous Metal Control Order, 1958" had been issued under section 3 of the , as the Licensing Order now under consideration also was Clause (4) of the order there considered provided that no person could acquire any nonferrous metal except under a permit issued by the Controller in accordance with such principles as the Central Government might from time to time specify. Subsequently, the Central Government enunciated certain principles for the grant of these permits in a certain communication to the Chief Industrial Adviser. Under these principles, no permit could be issued to a dealer but it could only be issued to certain manufacturers. The result was that the dealer 's trade was totally prohibited and only certain manufacturers were eligible for permits to carry on the trade of rolling non ferrous metals. Certain dealers moved this Court under article 32 for a declaration that el. (4) read with the principles formulated by the Government was bad as offending article 19(1)(f) and (g). This Court held that (p. 387) : "It is reasonable to think that the makers of the Constitution considered the word "restriction" to be sufficiently wide to save laws 'inconsistent ' with article 19(1), or "taking away the rights ' conferred by the (1) ; 962 Article, provided this inconsistency or taking away was reasonable in the interests of the different matters mentioned in the clause. There can be no doubt therefore that they intended the word restriction ' to include cases of 'prohibition ' also. The contention that a law prohibiting the exercise of a fundamental right is in no case saved, cannot therefore be accepted. " Having considered the facts of the case, the Court came to the conclusion that el. (3) of the Order, the legality of which also had been challenged, and el. (4) were valid provisions. It observed that, (p. 390): "It must therefore be held that el. 3 of the Order. even though it results in the, elimination of the dealer from the trade is a reasonable restriction in the interests of the general public. Clause 4 read with the principles specified must also, be hold for the same reason to be a reasonable restric tion. " I ought here to point out that the principles enunciated by the Government were held to be of no effect as they had not been issued in compliance with sub sections (5) and (6) of section 3 of the, and on that basis petition was allowed and a writ was issued restraining the Union from giving effect to el. 4 of the order so long as the principles governing the issue of permits were not duly specified. This however does not affect the force of the observations that I have earlier read from the judgment in the case. It seems to me that these observations fully apply to the present case. The order read with the policy statement though it resulted in a complete prohibition in trading by dealers and in the creation of what the petitioner would call a monopoly in favour of certain manufacturers was hold to be good as a reasonable restriction on the 963 dealer 's right to trade under article 19(6) and the Writ was: issued only because the formalities required for specifying the policy statement had not been complied with. There is no defect in the issue of the Licensing Order, 1961, with which the present case is concerned. Therefore, the only question would be whether such a prohibition of the trade of the dealers like the petitioner, if any, by the Licensing Order, 1961 would be reasonable in the circumstances of this case. , The other case to which I wish to refer is Glass Chatons Importers & User 's Association vs The Union of India (1) decided by this Court on April 10, 1961. That case arose out of a petition under article 32 by certain importers of glass chatons. There, the Central Government had issued an order under the Import and Export (Control) Act, 1947, called the Imports (Control) Order, 1955, prohibiting the import of glass chatons except under a licence. Paragraph 6 of the Order laid down a number of grounds on which the Central Government or the Chief Controller of Imports and Exports might refuse to grant a licence or direct any other licensing authority not to grant a licence. The ground mentioned in el. (h) of this paragraph was ,if the licensing authority decide to canalise imports and the distribution thereof through special or specialised agencies or channels. " It appears that since 1958, licences had been granted to the State Trading Corporation. No applications for licences had been, made by the petitioners or any other trader at any time since 1957. It was however contended that so long as paragraph 6(h) of the Order remained, it was useless for the private traders to apply for licences. The argument advanced on behalf of the petitioners was that paragraph 6(h) was void being in contravention of article 19(1)(f) and (g). In regard to this argument this Court observed: (1) (W. P. 65 of 1959, unreported). 964 "It is obvious that if a decision has been made that imports shall be by particular agencies or channels the granting of licence to any applicant outside the agency or channel would frustrate the implementation of that decision. If therefore a canalization of imports is in the interests of the genera l public the refusal of imports licences to applicants outside the agencies or channels decided upon must necessarily be hold also in the interests of the general public. The real question therefore is : Is the canalization through special or specialized agencies or channels in the interests of the general public." The Court held that it was unable to accept the argument that a decision that imports shall be canalised is per se not a reasonable restriction on the right to trade. On the facts of the case, the Court took the view that a decision to canalise imports of glass chatons was in the interest of the general public. In this case, it had been contended that the Government was creating a monopoly in favour of the State Trading Corporation. The Court hold that the period of permits granted to the State Trading Corporation having already expired, the question did not really arise. But, as would have been noticed earlier, the Court really dealt with the same contention in deciding the validity of paragraph 6(h) of the Order. This decision lends equally strong support to the view that preference directed to be given by cl. (e) of paragraph 5 of the Licensing Order with which we are concerned to co operative societies, would not necessarily render it invalid. I feel no doubt on the facts of the present case that a preference to co operative societies even if that resulted in the dealers being prevented altogether from dealing in paddy, would, be a reasonable restriction on the latter 's right of trade. Assam is a deficit State in foodgrains. It is the 965 duty of the State Government to see that the people living within its boundaries are supplied with adequate foodgrains and that at a reasonable price. The If paddy is procured for the use of the consumers in the State through a co operative society, there is good reason, as already stated, to think that rice at a reasonable price would be available to the people of Assam. I will later in detail discuss the structure and the activities of the co operative societies to whom licences had been granted. What I will have to say there will amply establish that it was a reasonable step to have taken to put the trade in charge solely of the co operative societies. I turn now to the petitioner 's second contention, namely. that cl.(e) of paragraph 5 has been worked in a discriminatory manner so as to create a monopoly in favour of the Apex Society. The first thing that I wish to observe is that licences have not been given for the year 1961 to the Apex Society but they have been given to a large number of primary co operative societies of growers. I find it difficult, in any case, to appreciate how this can be said to create a monopoly. It may amount to a prohibition of trade by some persons. That however is a different matter with which I have already dealt. I may state here that it appears that in 1960 the licences had been issued to the Apex Society, but that is not the situation now. Whether what was done in 1960 was strictly legal or not is not a question that now arises, for we are no longer concerned with the licences for 1960. I Before proceeding further, I think it right to I say a few things about the co operative societies with which we are concerned. About 1957, the Assam Government sponsored the formation of the Apex Society. I would like to remind here. that it is one of the directive principles of the Constitution that co operative societies should be encouraged. Now, the structure of the Apex Society is like a pyramid. It appears to have three tiers. On the top is the Apex Society. Under it 966 come various. primary marketing Co operative societies. At the bottom rung are a large number of primary co operative service societies. The membership of the marketing, societies consists mostly of cultivators and service societies, and of the service societies, mostly of cultivators. The function of the Apex Society appears to be to co. ordinate the working of the subsidiary societies and to obtain moneys from the Co operative Apex Bank and there out make advances to the cultivators through the subsidiary societies, to help them in their cultivation. The service societies procure from the growers the paddy grown by them I they can spare and realise the moneys advanced to them out. of the price of the paddy purchased. The money realised is duly passed on to the Apex Society. The paddy collected is sold by the service societies to the marketing societies. The marketing societies in their turn deliver part of the paddy to the Government for creating a buffer stock and the remaining quantity to mills for milling into rice, in both cases according to the directions of the Government. The benefits derived from the whole scheme are obviously very large. The middlemen are eliminated. The growers being themselves members of 'the societies, participate in their profits whatever they are. :This helps to keep down the price because a service society in passing on the paddy to the marketing society charges very little by way of profit and that profit is shared by the groweres who are its members. This enables the growers to sell at a comparatively lower price. The growers have further the advantage of loans from the Apex Society to help them in the Work of cultivation; these loans can be easily advanced and on liberal terms because their repayment is secured by. ,the process of purchase of the produce through the, service societies. It would he reasonable to think that this. would encourage cultivation and result in larger quantities of foodgrains , being produced. That would also help to achieve the 967 object of the Act It may further be pointed out that each of these societies is a body corporate see s.18 of the Co operative Societies Act, 1912. The societies form a net work over the entire surplus grain producing area of Assam, each working in its own area. , A vast number of growers of foodgrains are the members of the primary. marketing and service societies. It is to these societies that the licences had been issued of which, a grievance is being made by the petitioner. It appears that after the Apex and the subsidiary societies had been formed, the State Government with the concurrence of the Central Government decided on a policy of procuring paddy in certain specified areas only through these societies. The State Government thereupon issued instructions to certain officers at the end of 1959 at procurement of paddy for the Kharif year 1959 60 would be made through the co operative societies. It may be that it was for this reason that the licensing authority had stated in its order of February 17, 1930, earlier mentioned, that the petitioner 's application for a licence could not be considered. I have now to remind that the Licensing Order, 1960 did not contain any provision enabling preference 'being given to a co . operative society in the grant of a licence. This case however is not concerned any more with regard to a licence for the year 1960 or the validity of any order of the licensing authority refusing to grant the petitioner any licence for that year. Returning to the contention that the power under paragraph 5 (e) of the Licensing Order had been exercised in a discriminatory manner, I wish first to observe that under the Order which I have already held to be good, the authority concerned in granting the licences was entitled to prefer a co operative society, and this is what, it has ,done. Though the result may have been to prevent the petitioner from carrying on, the trade of purchasing and selling paddy, that, in my view is, in the 968 circumstances of this case, a reasonable restriction on his ' right to trade for that was necessary to secure for the people of Assam supply of foodgrains at a reasonable price and in adequate quantities: I have very grave doubts if the licensing authority was intended to act in a Quasi judicial capacity in the matter of granting licences. It has to be remembered that the question before it was not so , much of the competing rights of various applicants or of any is between an applicant and the State. The duty of the licensing authority was to advance the object of the Act in terms of the Licensing Order. Its main consideration has to be to see that the licences granted by it helped to make foodgrains available at a fair price to the people of Assam. The Act gave the powers for that purpose. It is because this purpose is legitimate that the resultant prohibition of trading by private dealers is also legitimate. I believe that the two cases I have earlier mentioned proceeded on the basis that the licensing authority was not a quasi judicial officer. It is not necessary for me however to pronounce finally on this question. It was contended that the licensing authority in granting the licence to the co operative society had only carried out the directions of the Government and had not acted independently. I find no basis for this contention apart from the bald allegation of the petitioners which is denied by the respondent. N directions by the Assam Government for the year 1961 have been produced. The instructions to which I have earlier referred requiring the licence to be given to the co operative societies were confined to the year 1959 60. That had no force in regard to the year 1961 with which we are concerned. Those instructions cannot be taken as operating for all time to come for then the licensing authority 's order granting licences to a co operative society in future years will always have 'to be held to have been made under these instructions. I am unable to take such a view of the matter. As 969 already stated, the High Court had by its Order of August 10, 1960 asked the licensing authority to proceed in a quasi judicial manner. There is no reason to think that the licensing authority had not observed this direction of the High Court. It also seems to me reasonable to think that the Assam Government inserted cl. (e) in paragraph 5 of the Licensing Order, 1961 in view of the judgments of the High Court of Assam to which I have earlier referred. The Assam Government obviously intended that the licensing authority would in view of cl. (e) give preference to the co operative societies. Furthermore, section 4 of the Act provides that an order made under section 3 conferring powers on any officer or authority may contain directions to him as to the exercise of such powers. In my view, for the reasons earlier stated, a direction in the Licensing Order to give preference to co operative societies would not be bad. It seems to me that cl. (e) of paragraph 5 of the Licensing Order, 1961 really amounts to such a direction. It was not necessary after the Licensing Order, 1961 for the Government of Assam therefore to give any other direction to the licensing authority. I do not think any question of violation of article 14 can be seriously pressed. If the duty of the licensing authority was quasi judicial in its nature, then it is difficult to appreciate how it can be said that its decision would offend article 14. In any case, it seems to me quite clear that the co operative societies form a class by themselves and a provision giving preference to such a class, would be a good provision because the object of the Act would be better served thereby for the reasons earlier mentioned; such provision would have a clear nexus with the object of the Act and therefore satisfy the test of article 14. Looking at the matter from any point of view it seems to me that the Order of the licensing authority giving preference to the co operative 970 Societies is not open to any objection. In my view that was a fair Order to have been made in the circumstances of this case. I would for these reasons dismiss this petition. MUDHOLKAR, J. I agree with the judgment delivered by Sarkar, J. By Court In accordance with the opinion of the majority this Writ Petition is allowed with costs. Petition allowed.

In exercise of the powers conferred by section 3 of the: Essential commodities Art, 1955, the Assam Government made the Assam Foodgrains (Licensing and Control) Order, 1961. This Order provided that no person could do business in foodgrains including, rice and paddy, in wholesale quantities except under a licence issued thereunder. Clause 5 of, the Order laid down in sub. (a) to (e) matters which the licensing authority shall, among other matters, which have regard to in granting or refusing a license sub cl. (e) being whether the applicant is a co operative society". In 1959, directions had been issued to all, licensing authorities by the Government that the rights of monopoly procurement had been given to Apex Co operative Society. The petitioner applied for a licence but was refused in view of the provisions of sub cl. (e) of cl. 5 of the Order. The petitioner challenged the order refusing the licence on the grounds: (1) that sub clause (e) was ultra vires 937 as ' it was beyond the powers granted to the State Government under section 3 read with section 5 of the Act, and (ii) that sub cl (e) had been applied in a discriminatory manner with a view to create a monopoly in favour of the Apex Co operative Society. Held, (per C.J., Das and Ayyangar, JJ.), that sub cl. (c) of cl. 5 of the Order was not ultra vires section 3 read with section 5 of the Act, but the impugned,order rejecting the application of the petitioner was bad as it infringed the rights of the petitioner guaranteed under Arts, 14 and 19 of the Constitution. Section 3 of the Act authorised the making of an order to achieve two objects, for maintaining or increasing supplies of essential commodities and for securing their equitable distribution and availability at fair prices. Sub clause (e) of cl. 5 of the Control Order,, 1961, which enabled the licensing authority to ' prefer a cooperative society in certain circumstances in the matter of granting a licence, was not unrelated to the objects mentioned in s.3 of the Act. A co operative society may, by reason of the place which it occupies in the village economy of a particular area, be in a better position for maintaining or increasing supplies of rice and paddy and even for securing their equitable distribution and availability at fair prices. Ramanlal Nagardas vs M. section Palnitkar, A. I.R. 1961 Guj. 38, distinguished. Sub clause (e) permitted the licensing authority to give preference to co operative societies in certain cases but it did not. have the effect of creating a monopoly in favour of co operative societies. In the present case the licensing authority refused licence to the petitioner for the only reason and purpose of granting a monopoly to co operative societies; it had administered the law in a discriminatory manner and for the purpose of achieving the ulterior object of creating a monopoly in favour of co operatives which object was not within sub cl. (a), The licensing Authority was influenced, not by considerations mentioned in cl. 5 of the Order, but by the instruction issued by the ' State Government to grant licences to cooperatives only. It was not proper for the, Government to issue instructions to the licensing authorities when they were required to act according to the provisions of law. Per Sarkar and Mudholkar,JJ. Sub clause (e) of cl. 5 of the Order served the object of section 3 of the Act to maintain or increase the supplies of essential 'commodities and to secure their equitable distribution and availability at fair prices and Was not ultra vires. Even it the Order allowed only one class, namely cooperative societies, to do the business and prohibited others. it would; still advance the objects, of, the Act; and the prohibition of the others. doing the business would amount. to, reasonable restrictions under article 19(6). 938 Narendra Kumar vs The Union of india, (ISM 2 S.C.R. 375 and Glass Chatons Imports a Users ' Association vs The Union of India, (W.P. 65 of 1959, unreported), relied on. The licensing authority had not exercised its power under sub cl. (e) in a discriminatory manner in the prevent case. The authority was entitled to give preference to a co operative society and that is what it has done. Though the result of this preference was to prevent the petitioner from carrying on his business, it was in the circumstances, a reasonable restriction on his right as it was necessary for securing foodgrains at reasonable prices and in adequate quantities. There were no directions given, by the State Government in 1961 to licensing authorities to grant licences only to co operative societies and it could not be said that the licencing authority had only carried out the directions of the Government and had not acted independently. In fact, the Order itself carried a direction in sub cl. (e) to give preference to co operative societies. The co operative societics formed a class by themselves and a provision giving preference to such a class better served the objects of the Act, and had a clear nexus with the object of the Act and did not offend article 14.

iminal Appeal No. 65 of 1959. Appeal by special leave from the judgment and order dated January 9, 1959, of the Bombay High Court in Criminal Revision Application No. 1485 of 1958. C. K. Daphtary, Solicitor General of India, B. R. L. Iyengar and T.M. Sen, for the appellant. Nur ud din Ahmed and Naunit Lal, for respondent No. 1. 1961. October 6. The Judgment of the Court was delivered by SHAH, J. This is an appeal by the State of Bombay against the order passed by the High Court of Judicature, Bombay, acquitting the respondents of offences punishable under sections 65(a)(1) and 66(b)(1) of the Bombay Prohibition Act XXV of 1949 hereinafter referred to as the Act. The respondents are residents of Sehore a town in what was at the material time the territory of the State of Bhopal. Respondent 1 is the brother of the owner of a concern which carries on business of manufacturing drugs, in the name and style of Rajkumar Laboratories, Sehore. Prabhat Trading Company a firm carrying on business at Ahmedabad in the State of Bombay placed an order on January 26, 1955, with the Rajkumar Laboratories, for 4800 bottles of Mrugmadasav ' an Ayurvedic 18 preparation. The Rajkumar Laboratories prepared the drug and as it contained rectified spirit, paid Rs. 3600 as excise duty to the Bhopal State. A permit authorising export of the preparation out of the Limits of Bhopal State was also obtained on July 28, 1955. A motor truck belonging to the second respondent was engaged for transporting the preparation from Sehore to Ahmedabad. On July 29, 1955, Sub Inspector Shintre stopped the motor truck at Dohad a. town in the State of Bombay The motor truck on examination was found carrying 7073 bottles of various sizes labelled "Mrugmadasav, Rajkumar Laboratories, Sehore. " on the label was also printed the legend that the preparation contained 85.5% alcohol. Respondents 1 and 2 who were accompanying the motor truck in a jeep in which also bottles of Mrugmadasav were found, were arrested. Samples of the contents of the bottles were drawn and collected in the presence of Panchas and were sent to the Assistant Chemist, Drugs and Excise Laboratory, Baroda, for analysis and report. Samples were also sent to the Principal of R. A. Poddar Ayurvedic college at Bombay. The respondents and eight others were then prosecuted in the Court of the Judicial Magistrate, 1st class, Dohad, State of Bombay for offences punishable under SS. 65(a) and 66(1)(b) of the Bombay Prohibition Act XXV of 1949. The Magistrate convicted the first respondent of offences under 88. 65(a) and 66(1)(b), the second respondent of offences under 8. 65(a) read with 8. 81 of the Bombay Prohibition Act, and four other accused with whom we are not concerned in this appeal, of certain offences. The Court of Session at Panch Mahals at Godhra, in appeal, confirmed the order and sentence, but in exercise of its revisional Jurisdiction, the High Court of Bombay set aside the conviction and sentence passed upon the respondents and acquitted them. The High Court held (a) that the State failed to prove that the contents of the bottles were liquor meant for consumption 19 as intoxicant and (b) that the State Government "could not validly come to the conclusion that the bottles contained intoxicating liquor without obtaining the opinion of the Board of Experts constituted under section 6A of the Bombay Prohibition Act. Against the order of acquittal the State of Bombay has preferred this appeal with special leave. It was the Case for the State that the bottles seized by the police, though labelled "Mrugmadasav", which is an Ayurvedic preparation indicated foruse in delirious fever and cholera, did not contain genuine Mrugmadasav but contained intoxicating liquor, import, transportation and possession whereof without a permit or licence under the Bombay Prohibition Act were prohibited. H. P. Parikh, Assistant Chemist, Drugs & Excise Laboratory, Baroda, stated that on analysis, the samples were found to contain 75.55% to 79.97% V/V ethyl alcohol and that in his opinion contents of the bottles were not an "Asav" preparation. In his opinion the liquid analysed was fit for use as intoxicating liquor and that it was not a standard preparation, though he could not say whether it was a medicinal preparation, he having no means of examining the other active ingredients. M. Y. Lele Principal of R. A. Podar Ayurvedic College, stated that the principal constituent of Mrugmadasav is musk (Mrugmad), which has a characteristic and penetrating odour, and that he could not get any odour of musk out of the sample sent to him and that, in his opinion, the contents of the bottles were not Mrugmadasav at all. He also stated that in about 6 1/2 seers of Mrugmadasav prepared according to the Ayurvedic formula there would be 20 tolas of musk and that the current market rate of musk was Rs. 60 to Rs. 80 per tola. One Ansare, Excise Inspector of Sehore, was also examined on behalf of the prosecution. He stated that the alcoholic proof strength of the liquid in the bottles was 150 and the percentage of alcohol therein was .855% V/V and that the rest was water. The 20 witness deposed that the Mrugmadasav which was meant for export to Ahmedabad was manufactured under his supervision and that it was a "proprietary ayurvedic preparation of added alcohol", and that it was "not a genuine preparation of self generated alcohol". To a question asked in cross examination, the witness stated that in his presence 50 tolas of rectified spirit were added to 4 tolas of musk and 2 tolas each of black pepper, jaifal, pipal and cinnamon. This part of the statement of the witness was disbelieved by the trial Magistrate and by the Sessions Judge. The Magistrate held on review of the evidence that the respondents had imported into the State of Bombay a preparation which contained a large percentage of alcohol which was not self generated that the preparation did not contain musk and that it did not conform to the standard formula of Mrugmadasav and that the preparation seized by the police was meant for internal consumption and as consumption thereof was likely to cause intoxication it was not exempt from the operation of sections 12 and 13 of the Act. The Sessions Judge agreed with the Magistrate. But the High Court disagreed with that view on the ground that the testimony of Lele, who relied solely upon his 'sense of smell" could not justify the conclusion that the liquor(l seized was alcohol meant for consumption as intoxicating liquor and that Parikh, who found on examination that the preparation seized contained 75% alcohol Was unable to state what the other ingredients were. Section 2(24) of the Bombay Prohibition Act defines "liquor" as including (a) spirit of wine, denatured spirit, beer, toddy and all liquids consisting of or containing alcohol; and (b) any other intoxicating substance which the State Government may, by notification in the Official Gazette, declare to be liquor for the purpose of the Bombay Prohibition Act. Section 2(22) defines "intoxicant" as meaning any liquor, intoxicating drug, opium or any other substance, which the State Government may by notification in the official Gazette declares 21 to be an intoxicant. Sections 12 to 24, in Chapter Ill of the Act, contain diverse prohibitions. By section 12 it is provided that "No person shall (a) manufacture liquor; ( b) construct or work any distillery or brewery; (c) import, export, transport or possess liquor; or sell or buy liquor. Section 13 provides that no person shall (a) bottle any liquor for sale; (b) consume or use liquor; or (c) use, keep or have in his possession any materials, still utensils, implements or apparatus whatsoever for the manufacture of any liquor. These prohibitions have to be read subject to section 11 which, in so far as it is material, provides that notwithstanding the prohibitions contained in the Chapter it shall be, lawful to import, export, transport, manufacture, sell, buy, possess, use or consume any intoxicant in the manner and to the extent provided by the provisions of the Act or any rules, regulations or orders made in accordance with the terms and conditions of a licence, permit pass or authorization granted thereunder. The prohibitions contained in ss.12 and 13 are also subject to restrictions contained in section 24A which was added by Bombay Act 26 of 1952. In the Act, as originally enacted, the prohibitions contained in the various sections were, subject to section 11 absolute. The validity of the Bombay Prohibition Act was challenged in the Bombay High Court, and that High Court declared certain provisions of the Act ultra vires (Fram Nusservanji Balsara vs State of Bombay(l). Against the decisions of the High Court an appeal was preferred to this Court(2). Fazal Ali, J., who delivered the judgment of the Court summarised his conclusions in so far as they are material to this appeal, as follows: In the result I declare the following provisions of the Act only to be invalid: (1) 1. L. R. (2) The State of Bombay vs F.N. Balsara ; 22 (1) Clause (c), of section 12, so far as it affects possession of liquid medicinal and toilet preparations containing alcohol. (2) Clause (d) of section 12, so far as it affects the selling or buying or such medicinal and toilet preparations containing alcohol. (3) Clause (b) of section 13, so far as it affects the consumption or use of such medicinal and toilet preparations containing alcohol." The Bombay Legislature there after enacted Act 26 of 1952 which by section 7 added s.24A, which as subsequently amended reads as follows: "Nothing in this Chapter shall be deemed to apply to (1) any toilet preparation containing alcohol which is unfit for use as intoxicating liquor; (2) any medicinal preparation containing alcohol which is unfit for use as intoxicating liquor; (3) any antiseptic preparation or solution containing alcohol which is unfit for use as intoxicating liquor; (4) any flavouring extract, essence or syrup containing alcohol which is unfit for use as intoxicating liquor: Provided that such article corresponds with the description and limitations mentioned in section 59A: Provided further that the purchase, possession or use of any liquor or alcohol for the manufacture of any such article shall not be made or h d except under a licence granted under section 31A." By this addition, the prohibitions imposed by sections 12 and 13 were not to apply to toilet, medicinal, 23 antiseptic and flavouring extract, essence or syrup preparations containing alcohol specified therein. The respondents contend that Mrugmadasau imported by them and found in their possession by the Sub Inspector of Police was a genuine Ayurvedic medicinal preparation; that in ay event, the State must prove that it was not a medicinal preparation; and that the burden lies on the State to prove their case that the importation and possession by the respondents of the contents of the bottles was in violation of the prohibitions imposed by sections 12 and 13 of the Act inviting as a consequence the penal provisions of sections 65 and 66 of the Act. In a criminal prosecution, normally the burden lies upon the prosecution to prove all the ingredients which constitute the offence charged against the accused, and we are unable to agree with the submission of the Solicitor General that a different rule is indicate in the trial of offences under the Act. It was for the State to prove that the substance seized, if a medicinal preparation, was not unfit for use as intoxicating liquor. The State has even under the Prohibition Act to establish that the respondents had infringed the prohibitions contained in sections 12 and 13. Undoubtedly, by virtue of section 24 a the prohibitions do not apply to certain categories of toilet, medicinal, antiseptic and flavouring preparations, even if they contain alcohol; but on that account the burden lying upon the State to establish in any given case in which it is alleged that the accused has infringed the prohibitions contained is sections 12 and 13 that the infringement was not in respect of an article or preparation which was not in respect of an article or preparation which was covered by section 24 A is not shifted on to the shoulders of the accused. Section 24 A is in substance, not an exception; it takes out certain preparations from the prohibitions contained in sections 12 13 But the operation of section 24A does not extend to all medicinal, toilet antiseptic or flavouring preparations containing alcohol; even if the preparation 24 is a toilet, medicinal, antiseptic or flavouring preparation,if it is fit for use as intoxicating liquor the prohibitions contained in sections 12 and 13 will apply. In order that the provisions contained in section 24A is attracted, the contents of the article. even as a medicinal preparation has by the first proviso to correspond with the description and limitations" contained in section 59A i.e. no more alcohol shall be used in the manufacture of such article than the quantity necessary for extraction or solution of the elements contained therein and for the preservation of the article, and in case of manufacture of an article in which the alcohol is generated by a process of fermentation the amount of such alcohol does not exceed 12 per cent. If alcohol in excess of the quantity prescribed by s.59A is found in the article, the provisions of section 24 A will not apply irrespective of the question whether it is fit or unfit to used as intoxicating liquor. Again, the preparation, even if it is medicinal, toilet, antiseptic or flavouring, must to unfit for use as intoxicating liquor i e. it must be such that it must not be capable of being used for intoxication without danger to health. If the preparation may be consumed for intoxication it would still not attract the application of section 24 A provided the intoxication would not be accompanied by other harmful effects. A medicinal preparation which may, because of the high percentage of alcohol contained therein, even if taken in its ordinary or normal dose intoxicate liquor A medicinal preparation containing a small percentage of alcohol ma still be capable of intoxicating if taken in large quantities, but if consumption of the preparation in large quantities is likely to involve danger to the health of the consumer, it cannot be regarded as fit to be used as intoxicating liquor. In the case before us, the preparation which is styled Mrugmadasau was sought to be passed off as a medicinal preparation. If genuine, it could have 25 been used in the treatment of certain fevers and cholera. The preparation, however, contained 75.5 ^ alcohol which is much in excess of the normal percentage of alcohol found in that preparation according to the standard Ayurvedic formula. The other constituents of Mrugmadasav as given in Bharat Bhishag Ratnakar Part IV are honey, water and comparatively small quantities of musk, black pepper, cloves, nut meg and cinnamon, and these are not such as to create any harmful effects or danger to health. From the evidence of Lele, it is clear, not withstanding the assertion to the contrary of Ansare (which is disbelieved by the Trial Magistrate and the Sessions Court) that the preparation seized could not contain any substantial quantity of musk. Having regard to the market price of musk, which ranged between Rs. 60 to Rs. 80 per tola at the material time, it would be impossible for any manufacturer intending to do business as a seller of drugs to price a bottle of Mrugmadasav at Rs.1 12.0 per Lb. When according to the standard formula it would contain about 4.% of musk and according to Ansare the preparation contained 8% of musk by weight. Even according to the standard formula, the value of musk alone in one Ib. Of Mrugmadasav would be from Rs.100 to Rs.140. The preparation seized by the police, therefore, could not contain genuine musk in any substantial or even appreciable quantity. The High Court did not rely upon the bare assertion of Lele because it was founded only upon the "sense of smell"; but the evidence of Lele is corroborated by the circumstance that musk could not be a constituent of the preparation, which was seized in the large quantity which it was claimed it contained. The other constituents of the preparation, according to Ansare, are comparatively speaking harmless drugs and having regard to the large percentage of alcohol even if it be regarded as a medicinal preparation, though not a standard 26 preparation, which was medicinal, prima facie, it was capable of intoxicating taken in a normal dose in which any "Asav" may be consumed. In any serious danger to health or concomitant deleterious effect. In that view of the case it must be held that the preparation seized by the police was not saved by virtue of section 24 A from the prohibitions contained in sections 12 and 13 of the Act. It is not the case of the accused and the burden of proving that case would lie upon the accused, that the importation or possession of the article seized was permitted under section 11 of the Act. The High Court following an earlier judgement of the Bombay High Court in D. k. Merchant vs The State of Bombay (1), decided against the State also on the ground that the prosecution for the offences under sections 65 and 66 could not be maintained unless the State Government was satisfied after consulting the Board of Experts under section 6A that the article was intoxicating liquor. In our view section 6A is not susceptible of the interpretation placed upon it by the High Court. Section 6A provides as follows: "6A. (1) For the purpose of determining whether (a) any medicinal or toilet preparation containing alcohol, or (b) any antiseptic preparation or solution containing alcohol, or (c) any flavouring extract, essence or syrup containing alcohol, is or is not an article unfit for use as intoxicating liquor, the State Government shall constitute a Board of Experts. (1) 27 (2) The Board of Experts constituted under sub section (1) shall consist of such members, not less than three in number, with such qualifications as may be prescribed. The members so appointed shall hold office during the pleasure of the State Government. (3) To members shall form a quorum for the disposal of the business of the Board (4) Any vacancy of the number of the Board shall be filled in as early as practicable: Provided that during any such vacancy the continuing members may act, as if no vacancy had occurred. (5) The procedure regarding the work of the Board shall be such may be prescribed. (6) It shall be the duty of the Board to advise the State Government on the question whether any article mentioned in sub section (1) containing alcohol is unfit for use as intoxicating, liquor and on such other matters incidental to the said question as may be referred to it by the State Government. On obtaining such advice the State Government shall determine whether any such article is fit or unfit for use as intoxicating liquor or not and such article shall be presumed accordingly to be fit or unfit for use as intoxicating liquor; until the contrary is proved. " By the first sub section a duty is cast upon the State Government to constitute a Board of Experts for the purpose of determining whether the medicinal, toilet or antiseptic preparations or flavouring materials containing alcohol are unfit for use as intoxicating liquor. Sub sections (2) to (5) deal with matters purely procedural. By sub section (6) duty is imposed upon the Board to advise the State Government on the question whether any substance mentioned in sub section ( 1 ) containing alcohol is unfit for use as intoxicating liquor and on such other 28 matters incidental to the said question as may be referred to it by the State Government. If the opinion of the Board is obtained, duty is imposed on the Government to determine whether the article is fir or unfit to be used as intoxicating liquor and on the determination so made by the Government a rebuttable presumption arises that the article is fit or unfit for use as intoxicating liquor. Substantially, the section creates three distinct obligations: (1) upon the State to constitute a Board for the purposes specified in sub s.(1): (2) upon the Board, when consulted, to advise the State Government whether a substance mentioned in sub section (1) is unfit for use as intoxicating liquor ; and (3) an obligation on the State, when the advice of the Board is received, to determine whether the article is fit or unfit to be used as intoxicating liquor. There is, however, no obligation expressly imposed upon the State in any given case to consult the Board of Experts, nor can such a provision be implied, and there is nothing in sections 65 and 66 which make the consultation with the Board a condition precedent to the institution of proceedings for breach of the provision of the Act. Section 6A WAS Incorporated in the Bombay Prohibition Act by Act 26 of 1952 which also incorporated section 24 A. In view of the judgement of this Court in Balsaras case (1) it was found that the Bombay Prohibition Act, in so far as it sought to impose restrictions and to provide penalties for infringement of those restrictions in respect of genuine medicinal, toilet, antiseptic preparations and flavouring extracts, was ultra vires. The Legislature enacted section 24 A and restricted the prohibitions contained in sections 12 and 13 qua these preparations. It also provided for setting up machinery for determining whether the preparations specified were unfit for use as intoxication liquor: but the Legislature did not impose any obligation upon the State to resort to the MACHINERY PROVIDED BY section 6A. By declining to avail itself of the machinery provided (1) The State of Bombay vs F. N. Balsara, [1951] section C. R . 682. 29 by sub section (6) of section 6A, in cases which are not sent to the Board, the State may undertake an onerous burden, i.e. it will not be entinled to rely on the presumption arising under the last sentence of that sub section and will have affirmatively to establish the ingredients of the offence. Consultation with the Board and the determination contemplated by 8. 6A would make the task of the State in a prosecution in respect of infringement of prohibitions regarding the liquor contained in ss.12 and 13 somewhat less onerous. The State may in a prosecution for infringement of the prohibition contained in sections 12 and 13 rely. upon the presumption, after resorting to the machinery under section 6A(6), but is not obliged to rely upon the presumption. Imposition of a duty to constitute a Board for the purposes specified in sub section (1), does lot involve a duty to consult the Board and imposition of a duty upon the Board to advise the State Government does not involve a duty to consult the Board in every case where a prosecution is sought to be launched in respect of any medicinal, toilet, antiseptic or flavouring preparation (containing alcohol. The plea that because the Government of Bhopal had levied a duty on the preparation an(l had granted a permit, no offence was committed by importing and possessing the offending preparations in the State of Bombay has, in our judgment, no substance. C which is a permit issued by the Government of Bhopal to export spirit, medicinal, toilet preparations and perfume containing Bhopal made spirit on payment, of duty in Bhopal State does not protect the importer of the preparation in another State against prosecution for an offence according to the law of that other State committed by the importation of such articles. The export permit has not and cannot have extra territorial effect; it merely enables a person seeking to export preparation to do so. The statement in Ext. L, a letter by the Prabhat Trading Co. to 30 Rajkumar Laboratories, Sehore that the former ``hold a licence for possession and sale" without production of such licence, cannot be set up in set up in defence. If it was the case of the respondents (and the burden of proving lay upon the respondents) that the importation and possession of the article was lawful in view of a licence issued under section 11, it was for them to produce the licence granted under that section. None such having been produce, the defence is not available to the respondents. Nor does the order of the Commissioner of Excise Department, Bhopal dated October 14, 1955 (Ext. M) advising against the exportation to the State of Bombay by the manufacturers to in the State of Bhopal of proprietary spirituous preparations including Mrugmadasav or other Ayurvedic preparations which contain a large percentage of alcohol without getting the preparations classified for duty purposes assist their case. It appears that in July , 1954 the Excise and prohibition Director of Bombay had addressed a letter to the Chief Commissioner of Bhopal informing that Officer that "28 restricted Asavas and Arishtas" mentioned in the list appended thereto were liable in the State of Bombay to duty at the rate of Rs 3 per Imperial Gallon of six reputed quart bottles and further requesting that Officer to issue instructions to manufacturers in the State of Bhopal that these preparations should not be exported to the State of a Bombay except on payment of the duty at the above prescribed rate to the credit of the State of Bombay and under cover of an export pass granted by the competent Excise authority of the District of export. The list of restricted Asavas and Arishtas does not include "Mrugmadasav" and it expressly refers to "Ayurvedic preparations prepared according to Ayurvedic process containing self generated alcohol. " There is nothing in the letter dated July 23, 1954, which may lend support to the contention of the respon 31 dents that they had on payment of excise duty been authorised to import "Mrugmadasav" and the prohibitions contained in sections 12 and 13 in respect of preparations containing alcohol were suspended, for the preparation is not one listed in the Schedule nor does it contain self generated alcohol. We are of the view, therefore, that the prohibitions contained in 88. 12 and 13 operated in respect of the preparation seized by the police and that the payment of excise duty to the Bhopal State under the law in force in that State, for exporting the preparation from that State did not protect the respondents from liability to prosecution for infringement of provisions of the Bombay Prohibition Act XXV of 1949 within the State of Bombay. We further hold that the High Court was in error in holding that the consultation with the Board under section 6A(G) of the Act was condition precedent to the launching of prosecution against the respondents. We set aside the order passed by the High Court and restore the order passed by the Judicial Magistrate, 1st Class, Dohad, and confirmed by the Court of Session at Panch Mahals sentencing the respondent No. 1 to rigorous imprisonment for six months, and to pay a fine of Rs. 500 and in default of payment of fine to suffer rigorous imprisonment for three month, and respondent 2 to rigorous imprisonment for one month and to pay a fine of Rs. 300 and in default of payment of fine to uudergo rigorous imprisonment of one month and fifteen days in addition. The order of confiscation of the property is also restored. Appeal allowed.

The respondents were charged with offences punishable under sections 65(a) and 66(1)(b) of the Bombay Prohibition Act, 1949, for violating the provisions of sections 12 and 13 of the Act. The prosecution case was that the respondents brought in their motor truck into the State of Bombay from the adjoining State of Bhopal, bottles labelled Mrugmadasav, and that the bottles did not contain genuine Mrugmasadav, an Ayurvedic preparation, but only intoxicating liquor, import transportation and possession whereof without permit or licence under the Act were prohibited. The Magistrate found that the bottles contained 75.50% alcohol much in excess of the normal percentage of alcohol used in preparing Mrugmadasav, according to the standard Ayurvedic formula 16 that it did not contain any appreciable quantity of musk essential in such a preparation, and that having regard to the large percentage of alcohol it was capable of being used for purposes of intoxication. Accordingly he held that the preparation Was not saved by s 24A from the prohibitions contained in sections 12 and 13 of the Act,and convicted the respondents. The High Court, however, acquitted the respondents on the grounds (a) that the State had failed to prove that the contents of the bottles were. liquor meant for consumption as intoxicant, and (b) that the State could not validly come to the conclusion that the bottles contained intoxicating liquor without obtaining the opinion of the Board of Experts constituted under. s 6A if the Act. In the appeal filed by the State of Bombay with special leave the respondents pleaded that, in any case, as the Government of Bhopal had levied a duty on the preparation and had granted a permit, no offence was committed by importing and possessing the preparations in the State of Bombay. ^ Held:(1) that it was for the State to prove that the substance, if a medicinal preparation. was not unfit for use as intoxicating liquor and to establish that the prohibitions contained in sections 12 and 13 of the Bombay Prohibitions Act, 1949, had been infringed, and that the burden of proof that infringement was not in respect of a preparation which was covered by s.24A was not shifted on the shoulders of the accused; (2) that if alcohol in excess of the quantity prescribed by s.59A was found in the article, the provisions of section 24A would not apply irrespective of the question whether it was fit or unfit to he used as intoxicating liquor; (3) that a medicinal preparation which may, because of the high percentage of alcohol contained therein, even if taken in its ordinary or normal dose intoxicate a normal person, would be regarded as intoxicating liquor within the meaning of section 24A, but such a preparation containing a small percentage of alcohol even though it might be capable of intoxicating if taken in large quantities, could not be regarded as fit to be used as intoxicating liquor within the meaning of that section. (4) that a State may in a prosecution for infringement of the prohibitions contained in sections 12 and 13 of the Act rely upon the presumption after resorting to the machinery under s 6A(6), but these was no obligation upon the State in any given case to consult the Board of Experts under section 6A nor was consultation with the Board a condition precedent to the institution of proceedings for breach of the provisions of the Act . 17 D. R. Merchant vs The State of Bombay, (1958) Bom. I, R. 1183, disapproved. (5) that the payment of excise duty to the Bhopal State under the law in force in the State for exporting the preparation from the State did not protect the respondents from liability to prosecution for the infringement of the prohibition laws in force in the State of Bombay; and (6) that in the instant case the preparation though styled Mrugmadasav was not a genuine medicinal preparation and having regard to the large percentage of alcohol contained therein it was capable of intoxicating taken even in a normal dose, and was not saved by section 24A from the prohibitions contained in sections 12 and 13 of the Act.

Civil Appeal No. 548 of 1958. Appeal by Special Leave from the judgment and order dated March 27, 1957, of the Patna High Court in Misc. Judicial Case No. 315 of 1956. B. Sen, P. W. Sahasrabudhe and A. C. Ratnaparkhi. for the Appellant K. L. Hathi and R. H. Dhebar, for Respondent No. 1. N. C. Chatterjee and section N. Mukerji, for Respondent No. 2. 1961. October 9. The Judgment of the Court was delivered by SARKAR, J. on September 25, 1947, the appellant was appointed by respondent No. 2, the Tata Iron and Steel Co., Ltd. (hereafter called the Company) as the Chief Labour officer of its collieries of which it appears to have a few, and he worked 33 under the Company till the latter terminated his services by a notice dated December 5,1955. On such discharge, the appellant , claiming to be a Welfare Officer of a mine within r.74(2) of the Mines Rules 1955, which rule we shall later ser out, filed an appeal before respondent No.1, the Chief Inspector of Mines in India, under that rule questioning the validity of his discharged by the Company. The Chief Inspector held that the appellant was not a Welfare Officer within that rule and refused to entertain his appeal. The appellant then moved the High Court at Patna under article 226 of the Constitution for an appropriate writ directing the chief inspector to decide the appeal. The High Court dismissed the appellant 's petition agreeing substantially with the view taken by the Chief Inspector. The appellant has now appealed to this Court against the judgment of the High Court. The Mines Rules; 1955 were framed under the , and came into force on July 2, 1956. We are principally concerned with the proviso for. 74(2) but this has to be read with r.72. The relevant portions of these rules are set out below. Rule 72. (1) In every mine wherein 500 or more persons are ordinarily employed there shall be appointed at least one Welfare Officer: Provided that if the number of persons ordinarily employed exceeds 2000, there shall be appointed additional Welfare Officer on a scale of one for every 2000 persons or fraction thereof (2) No person shall as a Welfare Officer of a mine unless he possesses (Here certain qualifications are specified) Provided that in case of a person already in service as a Welfare Officer in a mine the 34 above qualifications may, with the approval of the Chief Inspector be relaxed. (3). . . . . (4) A written notice of ever y such appointment. . and of the date thereof shall be sent by the owner, agent or manager t o the Chief Inspector within 7 days from the date of such appointment. . . Rule 73. Duties of Welfare officers: . . . . . . . . . . (Here certain duties are prescribed) Rule 74. (1). . . . . . . (2) The condition of service of a Welfare Officer shall be the same as of other members of the staff of corresponding status in the mine; Provided that in the case of discharge or dismissal, the Welfare Officer, shall have a right of appeal to the Chief Inspector whose decision thereon shall be final and binding upon the owner, agent or manager of the mine as the case may be. The Chief Inspector mentioned in these Rules is the Chief Inspector of Mines in India. If the appellant was not a Welfare officer within the proviso to r. 74(2) as the company contends, then, of course, no appeal by him lay under it. He would then clearly not be entitled to the writ he asked. The question therefore is whether the appellant was a Welfare Officer within the rule and is really one of construction of it. We desire now to point out certain facts as to which there is no controversy. First, both the Act and the Rules came into force long after the appellant had been appointed by the Company. Secondly no relaxation of qualifications had been sought from or granted by the Chief Inspector with respect to 35 The appellant under the proviso to sub r. (2) of r. 72 after the Rules came in to force. Thirdly, no notice as contemplated in r. 72(4) had been given concerning the appellant. It appears that the Chief Inspector found that the appellant "was performing duties akin to those of Welfare officers contemplated by rule 73 and he was qualified to work as a Welfare officer. " We propose to deal with this appeal on the basis of these findings. Dealing with the contention noticed by the Chief Inspector and the High Court that a Welfare Officer under r. 74(2) is one who is appointed after the Rules came into force, Mr. Sen for the appellant said that a person like the appellant who had the requisite qualifications and was discharging the duties prescribed for a Welfare officer from before the Rules came into force, would be a Welfare officer within them. He pointed out that the proviso to sub r. (2) of r. 72 clearly contemplated the continuance of the service of such a person as a Welfare officer with relaxation where such was necessary and was granted. He also said that sub r. (4) of r. 72 was inapplicable to Such a person because he had been appointed long ago and because the proviso to r. 72(2) indicated that its application was not intended. We do not think it necessary to pronounce on this question in the present case. In our view, the appeal must fail even if Mr. Sen 's contention is right and that for another reason . We observe that the Rules do not define the term "Welfare officer". But we think it is beyond doubt and indeed the contrary has not been contended that the Welfare officer mentioned in the proviso to r. 74(2) is the same officer as is mentioned in sub r (1) of r. 72. Now it is, in our view, perfectly plain that the Welfare officer contemplated by r. 72(1) is such an officer of one mine. The rule says that there shall be at least one Welfare officer for every mine employing between 500 and 2000 persons and this makes any other view impossible 36 As we understood Mr. Sen, he also accepted that the Welfare officer contemplated is one appointed in respect of one mine. Now, the appellant was on his own case, the Welfare Officer of several mines of the Company and not of one of such mines only. Therefore, we think that he was not a Welfare officer within r. 72(1) and hence not within the proviso to r. 74(2). But Mr. Sen contends that the appellant might be considered as having been severally and independently appointed the Welfare officer of each of the Company 's several collieries in his charge. We think that would be an impossible view to take. One appointment cannot be treated as several appointments and it is not in dispute that the appellant had only one appointment for all the Company 's collieries. We think that this appeal fails and we dismiss it with costs. Appeal dismissed.

The appellant was appointed as the Chief Labour officer by the Company in 1947. In December; 1955, the company terminated his services The appellant, claiming to be a Welfare officer, preferred an appeal to the Chief Inspector of Mines under r. 74(2) of the Mines Rules, 1955. ^ Held, that the appellant was not a Welfare officer and as such could not prefer an appeal under r. 74 (2). The Welfare officer mentioned in r. 74 (2) is the same officer as is mentioned in r. 72 (1) which rule contemplates a Welfare officer appointed in respect of one mine. But the appellant was an officer of several mines of the Company and not of one of such mines only.

vil APPEAL No. 198 of 1956. Appeal from the judgment and decree dated August 24, 1950, of the Allahabad High Court in Execution First Appeal No. 399 of 1947. Gopi Nath Kunzru and Ganpat Rai, for the appellants G. section Pathak and G. C. Mathur, for the respondent. October l 2. The Judgment of the Court was delivered by SHAH, J. The Banaras Bank Ltd. a public limited company having its registered office at Banaras (hereinafter referred to as the Bank) was ordered on March l, 1 940 to be compulsorliy wound up by the High Court of Judicature at Allahabad, and the Official Liquidator was appointed to conduct the proceedings in winding up. On September 12, 1942, an order was made by the High Court under section 187 of the Indian Companies Act, 1913 (VII of 1913) for payment of unpaid calls and the appellants Jyoti Bhushan Gupta. and Gokul Chand, whose names had been placed on the list of contributors, were directed to pay with interest Rs. 95,178/5/9 to the official Liquidator of the Bank. This order was, by virtue of section 199 of the Act, enforceable in the manner in which the decree of the High Court made in any suit pending therein may be enforced. On September 12, 1946, the order was transferred to the District Judge, Allahabad for execution. On September 23, 1946, the official Liquidator applied to the District Court, Allahabad for execution of the order dated September 12, 1942, and prayed that certain amounts due to the appellants be attached in satisfaction of the claim. The execution proceedings were transferred by the District Judge 75 to the Civil Judge, Allahabad. The appellants contended Inter alia that as the application for execution was not preferred within 3 years of the order for payment as prescribed by article 182 of the First Schedule of the Limitation Act it was barred by the law of limitation. The official Liquidator contended that the application was governed by article 183 of the Act and that, in any event, certain part payments having been made towards the claim by the appellants, the period of limitation was extended thereby. At the hearing, the alternative plea of part payment was abandoned by the Official Liquidator. The Civi1 Judge held that the application for execution was barred limitation as it was not preferred within 3 years from the order of the High Court. In appeal to the High Court of Allahabad, the order passed by the Civil Judge was reversed and the proceedings were remitted to the Civil Judge with a direction to restore the execution application to its original number and to proceed with it according to law. Against that order with certificate of fitness granted by the High Court under article 133 of the Constitution, this appeal is preferred. Counsel for the Company contended that the order passed by the High Court not being a final order the appeal on certificate granted by this High Court is not maintainable. We have not thought it necessary, having regard to the importance of the question raised by the appellants and the fact that this Court may in a proper case regularise the proceeding in this Court by granting special leave, even if certificate under article 133 of the Constitution could not be issued by the High Court, to hear the parties on the question as to the maintainability of the appeal OD the certificate and have heard the appeal on the merits. We are of the view that the appeal must fail on the merits. 76 article 182 of the Indian Limitation Act provides a period of 3 years for an application for execution of a decreer an order of any Civil Court not provided by article 183 or section 48 of the Code of Civil Procedure, 1908 (V of l908). By article 183 a period of l2 years for enforcing a judgment, decree or order of any Court established by Royal Charter in the exercise of its ordinary original civil jurisdiction is prescribed and the period commences to run from the date on which a present right to enforce the judgment, decree or order accrues to some person capable of. releasing the right. The order sought to be executed was not passed by the High Court in the trial of a suit: it was passed in exercise of the jurisdiction conferred upon the High Court by section 187 of the Indian Companies s Act, 1913. Section 3 of the Indian Companies Act by sub s.(1) enacts that the Court having jurisdiction under this Act shall be the High Court having jurisdiction in the place at which the registered office of the company is situate. By the proviso, the Central Government may by notification in the official Gazette empower any District Court to exercise all or any of the jurisdiction conferred upon the High Court. But it is common ground that no notification conferring jurisdiction and empowering the District Court at Banaras where the registered office of the company is situate to pass orders under B. 187 has been issued. The High Court was therefore the only Court competent to direct under B. 187 of the Indian Companies Act payment of the amount due from the appellants. Counsel for the appellants contends that the authority exercised by the High Court in directing payment under section 187 of the Indian Companies Act, 1913, is neither ordinary, nor original civil. He submits that by section 187 a special power is vested in the High Court by the Indian Companies Act, 1913, which is exercisable in its extraordinary jurisdiction. To appreciate this argument it is necessary to refer to the statute authorising the establish 77 ment of the High Court, and the Letters Patent constituting the same. The High Court for the North Western Province, of which the Allahabad High Court is the successor, was constituted by the Letters Patent issued on March 17, 1866, in exercise of the powers conferred by cl. 16 of the Charter Act of 1861 (24.25 Vict. C. 104). By that clause, Her Majesty the Queen was authorised to establish a High Court and to invest the High Court with such jurisdiction, powers and authority as under the Charter Act may by cl. 9 be conferred upon the High Court to be established in any of the presidencies, i. e., calcutta, Bombay and Madras. The High Courts of Calcutta, Bombay and Madras, which were popularly known as the Presidency High Courts were by cl. 12 of their respective Letters Patent invested with ordinary original civil jurisdiction to entertain and try suits of every description subject to the restriction as to territorial limitations contained in cl. 11 thereof. But by its Letters Patent, the High Court for the North Western Province was not invested with jurisdiction to entertain civil suits in exercise of its ordinary original civil jurisdiction. Counsel for the appellants submits that Art.183 applies only to decrees and orders passed by the High Courts established by the Royal Charter, which by their constitution are authorised to entertain, hear and try civil suits in exercise of their ordinary civil jurisdiction, and as no such power was conferred upon the Allahabad High Court, the order sought to be executed was not passed in exercise of the ordinary original civil jurisdiction. It is true that when the Letters Patent were issued the High Court had no jurisdiction under a law relating to companies of the nature exercised by the High Court, the character whereof falls to be determined in this appeal. But by cl. 16 of the Charter Act and cl. 35 of the Letters Patent of the Allahabad High Court jurisdiction 78 which Was not initially conferred upon the High Court could the conferred by legislation within the competence of the Governor General in Council and the Governor in Council. By the Companies Act of 1913, the High Court was invested with jurisdiction to order payment of the amounts due by debtors of companies ordered to be wound up. This jurisdiction may be invoked as of right against all persons whose names are placed on the list of contributors. The jurisdiction is ordinary: it does not depend on any extraordinary action on the part of the High Court. The jurisdiction is also original in character because the petition for exercise of the jurisdiction is entertainable by the High Court as a court of first instance and not in exercise of its appellate jurisdiction. Again by section 187 no special jurisdiction is conferred. The High Court adjudicates upon the liability of the debtor to pay debts due by him to the Company: the jurisdiction is therefore civil. Normally, a creditor has to file a suit to enforce liability for payment of a debt due to him from him debtor. The Legislature has by section 187 of the Companies Act empowered the High Court in a summary proceeding to determine the liability and to pass an order for payment, but on that account the real character of the jurisdiction exercised by the High Court is not altered. Nor is there any substance in the contention that the authority to order payment of a debt under section 187 is merely a power of the High Court and not its jurisdiction. By section 3 read with section 187 of the Companies Act the High Court has jurisdiction to direct payment of the amount due by a contributory: and an order passed for payment manifestly is an order passed in exercise of the jurisdiction vested in the High Court by section 3 read with 8. 187 of the Companies Act. The Judicial Committee of the Privy Council was called upon In the matter of Candas Narondas Navivahu and C. A. Turner(1) to determine the true (1) I. L. R. (1889) 13, Eom. 79 nature of the jurisdiction exercised by the High Court of judicature at Bombay in respect of insolvent debtors. The Privy Council held that article 180 of Schedule II of the Indian Limitation Act XV of 1877 (which was similar to article 183 of the Indian Limitation Act, l908) applies to a judgment of a Court for the relief of insolvent ebtors entered up in the High Court, in accordance with section 86 of the Statute 11 and 12 Vic., c. 21. It was held in that case that although a Court exercising insolvency jurisdiction determines the substance of the question relating to an insolvent 's estate, the, proceedings in execution and the judgment are the High Court 'section The judgment is entered up in the ordinary course of the duty cast upon the High Court by the law, not by way of special or extra ordinary action, but in the exercise of its ordinary original civil jurisdiction. Lord Hobhouse delivering the judgment of the judicial committee observed: "But it was strongly contended at the bar that this jurisdiction though civil and original, was not ordinary: and Mr. Rugby argued that the passages of the Charter which have just been epitomised divide the jurisdiction into four classes ordinary original, extraordinary original, appellate, and those special matters which are tho subject of special and separate provisions. But their Lordships are of the opinion that the expression "ordinary jurisdiction" embraces all such as is exercised in the ordinary course of law and without any special step being necessary to assume it and that it is opposed to extraordinary jurisdiction, which the Court may assume at its discretion upon special occasions and by special orders. They are confirmed in this view by observing that, in the next group of clauses which indicated the law to be applied by the Court to the various clauses of cases, there is not a four fold division of jurisdiction, but a three fold one, into ordinary, extraordinary, 80 and appellate. The judgment of 1868 was entered up by the High Court, not by way of special or discretionary action, but in the ordinary course of the duty cast upon it by law, according to which every other case of the same kind would be dealt with. It was, therefore, entered up in exercise of the ordineary original civil jurisdiction of the High Court. " Council for the appellants contended that by cl. 18 of the letters Patent the High Court of Bombay was invested with insolvency jurisdiction whereas the High Court of Allahabad is not invested by the Letters Patent with any jurisdiction in the matter of companies and therefore the principle of "In re Candas Narondas" does not apply. But under cl. 18 of the Letters Patent a Judge or Judges of the High Court are to sit as a Court for relief of insolvent debtors and powers and authorities with respect to original and appellate jurisdiction are to be deter mined by reference to the law relating to insolvent debtors. The jurisdiction to deal with the claims of companies ordered to be wound up is conferred by the Indian Companies Act and to that extent the Letters Patent are modified. There is, however, no difference in the character of the original civil jurisdiction which is conferred upon the High Court by Letters Patent and the jurisdiction conferred by special Acts. When in exercise of its authority conferred by a special statute the High court in an application presented to it as a court of first instance declares liability to pay a debt, the jurisdiction exercised is original and civil and if the exercise of that jurisdiction does not depend upon any preliminary step invoking exercise of discretion of the High Court, the jurisdiction is ordinary. In P. T. Munia Servai v The Hanuman Bank Ltd, Tanjore (1), a Division Bench of the Madras (I) 1. L. R. 81 High Court by the Banking Companies Act, ]949 (X of 1949) is part of its ordinary civil jurisdiction within the meaning of article 183 of the Limitation Act and an order passed in exercise of its ordinary original Civil Jurisdiction is governed by article 183 and not by article 182 of the Limitation Act. In that case on an application preferred by the Official Liquidator of the Hanuman Bank Ltd., a direction for payment by the High Court of certain sums of money by the appellant Munia on or before a certain date was made. To an application for enforcement of that liability article 183 of the Limitation Act was held applicable. In our view, the High Court was right ill holding that the application for execution filed by the official Liquidator was within limitation. The appeal, therefore, fails and is dismissed with costs. Appeal dismissed.

The Banaras Bank Ltd. was ordered by the Allahabad High Court to be compulsorily wound up. The High Court passed an order under section 187 of the Indian Companies Act, 1913, directing the appellants, whose names had been placed on the list of contributors, to pay a certain sum of money to the official Liquidator. The official Liquidator applied for execution of the order more than three years after the making thereof. The appellants contended that the execution application, not having Been preferred within three years as prescribed by article 182 of the Limitation Act was barred. The official Liquidator contended that the order was made in the exercise of ordinary original civil jurisdiction by the High Court and the application was governed by article 183 which prescribed a period of limitation of twelve years. ^ Held, that article 183 was applicable to the case and the application for execution was within time. The order was Made by the High Court in the exercise of its ordinary original civil jurisdiction as contemplated in article 183. Though the Letters Patent did not invest the High Court with any original jurisdiction it could be conferred by legislation. The Indian Companies Act, 1913, invested the High Court with the jurisdiction to order payment of amounts due by debtors of companies ordered to be wound up. The jurisdiction was ordinary, it did not depend on and extraordinary action on the part of the High Court. It was original as a petition for the exercise of it was entertained by the High Court as a court of: first instance and not as an appellate court, and since the High Court adjudicated upon the liability of the debtor to pay debts due by him to the company the jurisdiction was civil. In the matter of Candas Narondas, Navivahu and C. A; Turner, I. L. R. and P. T. Munia Cervai 74 vs The Hunuman Bnak Ltd., I.L.R , referred to

Civil Appeal No. 529/1959. Appeal by special leave from the Award dated February 28, 1958, of the Central Government Industrial Tribunal Calcutta, in reference No. Of 1957. H. R. Gokhale, Yeshwant Chitale, Ratna Rao and K. R. Choudhri, for the appellants. section T. Desai, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for respondent No. 1. 1961. October 10. The Judgment of the Court was delivered by DAS GUPTA, J. This appeal by special leave is against an award of the Central Government Industrial Tribunal at Calcutta in a dispute referred to that Tribunal by the Central Government under s.10 of the Industrial Disputes Act between the workmen of the Bombay Port Trust, who are the appellants before US and the Trustees of the Port of Bombay, the respondents in the appeal. The workmen concerned in the dispute as referred are shore workers belonging to "A" category, "B" category and casual category. These three categories came into existence under the scheme adopted by the Bombay Port Trust in April 1948 for direct employment of shore workers in place of the system previously in force under which such labourers used to be supplied by contractors known as Toliwallas. The matters in dispute were specified thus in the letter of reference to the Tribunal: "Arrears due to the shore workers belonging to the "A" category, "B" category and casual category in respect of (i) weekly off with pay for the period 15th March, 1951 to 2nd March, 1956; (ii) work on weekly off days during the period 15th March, 1951 to 2nd March, 1956, without a compensatory day off in lieu; and 39 (iii) average daily wages for the weekly off days after the introduction of the piece rate scheme with effect from 3rd March, 1956, when the average fluctuated from week to week. " It became clear at the hearing before the Tribunal that of the period mentioned in Item (i) and Item (ii), viz., the 15th March, 1951 to 2nd March, 1956, no "weekly off" was given at all from the 15th March 1951 to October 1953 but workmen were made to work generally for all the 7 days of the week, and further that from October 1953 to 2nd March, 1956, Sunday was given as the "weekly off" and no work was taken on that day. The real dispute therefore as regards Item (i) and Item (ii) was in respect of (a) arrears of wages for Sunday the weekly off on which no work was done from October, 1953 to March 2 1956, and (b) arrears of wages for work done during the period 15th March, 1951 to October, 1953 on Sundays which should have been given as a weekly off day but was not, though no compensatory day was given in lieu thereof. As regards arrears of wages for Sundays on which no work was done the worksmen 's case is that they were entitled to receive payment for eah such Sunday amounts equal to their average daily wages during the preceding week. But admittedly no payment was made for these Sundays. The respondent 's case however is that on a proper interpretation of Rules 23 of the Minimum Wages (Central) Rules, 1960, the workmen were not entitled to payment for Sundays on which no work was done by them and further that in any case they have been constructively paid for the Sundays also inasmuch as the daily wages were fixed at I/26th of the monthly wage. The Tribunal accepted these contentions raised on behalf of the employer and held that there were no arrears of wages in respect of Sundays 40 for which no work was done. With regard to the period March 15, 1951 to October, 1953 it appears the workmen except morphias were paid at twice J the. Ordinary rate inclusive of all allowances, for all work done on Sundays; Morphias were paid one and a half time the normal rates of wages. The workers ' case is that for the work done on Sundays during this period they were entitled to three time. the ordinary rate. This claim was also rejected by the Tribunal which however held that the Morphias were entitled to double their wages inclusive of all allowances and so directed that they shall be paid for work done by them on weekly rest days from 15th March, 1951 to October 1953 the difference between double their wages inclusive of all allowances and that they have been paid. We may state at once that the dispute as regards arrears due to workers belonging to "casual" category has not been pressed before US and does not therefore require consideration in this appeal. The claim as regards arrears of wages for the period March 15, 1951, to October 1953 (except what has already been awarded for this period to Morphias) does not also merit serious consideration as the learned counsel for the appellant was unable to show any legal basis for such a claim. He tried to persuade to that as Rule 23 of the Minimum Wages (Central) Rules required the employer to give a weekly holiday on Sunday (unless this is given on some other day instead) it is not right that when the employer does not comply with that requirement he should get off with paying nothing more than what he would have paid for such work done on any day of the week because of the Rules in respect of extra payment for over time work. The itself contains provisions for contravention of the provisions of the Act or Rules or orders made thereunder. Section 22 provides for punishment inter alia for contravention of rules or orders under section 13. Section 22A provides for punishment withfine 41 (which may extend to five hundred to five hundred rupees) for contravention of any provision of the Act or of any rule or order made thereunder if no other penalty is provided for such contravention. The Minimum Wages Rules were made by the Central Government in exercise of the powers conferred by section 30 of the (Act XI of 1948) and so contravention of rule 23 of these rules is punishable under section 22A of the Act. Whether or not any action is taken against the employer for such contravention, the Industrial Tribunal has no authority to impose some other penalty in the shape of making the employer pay in respect of work done on Sundays something more than what he would have otherwise have to pay. Neither the Minimum Wages At nor the Rules contain any provision for such additional payment over and above what would be payable for over time work as such. The workmen 's claim for further payment in respect of work done on Sunday during, the period March 15, 1951 to October 1953 has therefore been rightly rejected. In respect of the claim for pay on Sundays during the period October 1953 to March 2, 1956, on which no work was done we have first to decide on the correct interpretation of the words "for which" in Rule 23, as it stood before it was amended by a Notification GSR 918 dated the 29th July, 1960. Tho Rule as it stood before the amendment ran thus: "23. Weekly Holidays (1) Unless other wise permitted by the Central Government, no worker shall be required or allowed to work in a scheduled employment, on the first day of the week (hereinafter referred to as the said day) except when he has or will have a holiday for the whole day on one of the five days immediately before or after the said day for which he shall receive payment equal to his average daily wages during the preceding week. 42 Provided that the weekly holidays may be substituted by another day: Provided further that no substitution shall be made which will result in any worker working for more than ten days consecutively without a holiday for a whole day. " We are not concerned with cl. 2 of Rule 23. The Explanation to the Rule is in the following words: Explanation For the purpose of this rule "week" shall mean a period of seven days beginning at midnight on Saturday night. " The main policy underlying the rule obviously is that workmen shall have full rest at frequent intervals ordinarily once in every 7 days but in no case at intervals of more than 10 days. This was clearly in accordance with the principle laid down in 8. 13 of the that the Government may provide for a day of rent for every period of 7 days even though in framing the Minimum Wages (Central) Rules 1960 (which covers many other matters other than the matters mentioned in 8.13) no reference has been made to section 13 at all. In giving effect to this policy of providing for a day of rest ordinarily once in 7 days but in no case at intervals of more than 10 days the rule making authority has thought fit also to make provision for making some payment in connection with this. Difficulty has however been caused by the unfortunate complexcity of the sentence, in which the main provision as regards the day of rest and also the subsidiary provision for payment have been combined. The dispute is about the meaning of the words "for which". If one remembers the rule of grammar that what the grammarians call the "antecedent" (that is the noun or pronoun to which a relative pronoun relates) should be used as near as possible to the relative pronoun, one is tempted to think that "which" relates to the word "day" of the "said 43 day" immediately preceding the preceding the preposition "for". Breaking up this last portion of the rule, the rule thus analysed would be equivalent to "and for the said day he shall receive payment equal to his average daily wages during the proceeding week". That will be however only A grammarian 's construction. In the Courts however while we have to remember the rules of grammar, because such rules are ordinarily observed by people in expressing their intentions, we have to look a little more closely to understand the: real intention expressed. It seems to us unreasonable to impute the rule making authority an intention that while if the weekly rest is given on the said day" that is, Sunday the workmen shall receive payment, he shall receive no payment if and when the employer takes advantage of the provisions that no workman may be required or allowed to work on Sunday when the has or will have a holiday for the whole day on one of the five days immediately before or after the said day. " For, it that be permitted, the employer would always give the weekly holiday on one of the 5 days immediately before or after the Sunday and thus avoid payment for the rest day. It seems clear to us therefore that in using the words "for which" after the words the said day" the rule making authority did not intend to continue the word "which" to this said day" but intended to relate this "which" to any of the days on which rest is given. In other words, 'for which" was used as short for and on such holiday whether on the said day or not". We do not think the rules of grammar stand in the way of this interpretation. Mr. Desai 's argument on behalf of the respondent is that '"which" relates to the word holiday and that accordingly it is only when the workman has or will have a holiday on one of the five days immediately before or after the said day, that he Shall receive payment. According to him, the two phrases for the whole day" and "one of the five days immediately before or after the said day" are adver . 44 bial phrases modifying the verb "has" and "will have" and no part of these phrases can have any connection with the words for which". Leaving of these out, the rule properly analysed is, he says, in really two portions: the first being "no worker shall be required or allowed to work in a scheduled employment, on the first day of week"; the second being except when he has or will have a holiday for which he shall receive payment equal to his average daily wages during the preceding week". That will however be to re write the sentence in a manner for which we can find no justification. It is proper to remember also that this interpretation will have the peculiar consequence that if the rest day is given on first day of the week no payment will have to be made, but if it is given on some other day payment will have to be made. It will be unreasonable to ascribe such an intention to the legislature. The Tribunal was so impressed by the unreasonableness of such a consequence that it came to the conclusion that no payment will be receivable by the workmen whether the weekly rest day is given on the first day of the week or on one of the five days immediately before or after the said day. Reading the operative portion of this rule with the proviso that the weekly holiday may be substituted by another day it appears to us clear that the rule making authority did not draw any distinction between the holiday on the first day of the week or the holiday on one of the five days immediately before or after the said day. It was this weekly holiday whether given on the 1st day of the week or whether on one of the five days immediately before or after the said day that under the proviso could be substituted by another day. The scheme clearly is for one holiday, generally, once in a week and it is for this one holiday that payment is provided. 45 Our attention was drawn to the view taken by the Bombay High Court in Trustees of the Port of Bombay vs Authority under the payment of Wages Act(1) which was followed by the Madras High Court in A.C.C. vs Labour Inspector(2) that the proper construction of the word "for which" is to relate to word "holiday" preceding the word" "for the whole day". In Jaswant Sugar Mills vs Sub Divisional Magistrate (3) the Allahabad High Court took the view that for which" refers to the weekly holiday whether it is on a Sunday or on any other days of the week as permitted under the Rules. In our opinion, the view taken by the Allahabad High Court correct. On a proper construction of the rule it must, in our opinion, be held that the workmen of categories A and were entitled to receive payment equal to the average wages during the preceding week" in respect of the period October 1963 to March 2, 1956. This brings us to the employer 's claim that there has been constructive payment for the Sundays during this period, viz., October 1953 to March 2, 1956. The argument is that the daily wage for these workmen was fixed by dividing all the Components of the monthly scale of pay and allowances by 26 so that what, a workman receives as daily wage is really 1/26th of the wage for 30 days. Thus, it is said, the total receipts for the 26 days, if no seperate payment is made for the rest days will be 26 x1/26th of 30 days wage. , that is 30 days ' wage. The fallacy in this argument is that it ignores the essential fact that once the daily wage is fixed at a certain figure it no longer retains its character of being 1/26th of the monthly wage. However arrived at, the daily wage is a daily wage and it is wrong to regard it as a certain fraction of the monthly wage. When the Central Government making in these Minimum Wages Rules made this provision for payment on a holiday it clearly (1)1957 (1) L. L. J. 627. (2) 1960(I) L. L. J. 192. (3) 1960 (II) L. L. J. 373. 46 intended that something in addition to what was being actually received for the six days of the week should be paid. This cannot be defeated by a statement that though in form six days wages were being paid, infact and in substance, fieven days wages were being paid. By no stretch of imagination can payment for six days be equated to payment for seven days. We have therefore come to the conclusion that the workmen of the A and categories are entitled to arrears of wages in respect of Sundays during the period octobcr 1953 to March 2, 1956. With effect from March 3, 1856 the piece rate scheme was introduced fer the shore woIkers belonging to the A" category and B ' category. Tbe essentials of this scheme are that a datum line was fixed for the different kinds of u.ork and tl piece rate would vary with the proportion which the out turn of the gang bears to the datum line in the following manner: "For a hift fully occupied in doing piece rate work the piece rate wage of the basic gang worker (inclusive of basic pay and the allowancefi above mentioned) shall rise uniformly from Rs. 3 1 O at 76% to Rs. 4 5 O at lOO% to Rs 8 at 150% of the datum line. The piece rate wage earned after 150% of the datum line shall be processed at double the daily wage that is to say the piece rate wage will rise uniformly from Rs. 8 at 150% to Rs. 12 at to at to 200% of the datum line. " The scheme further provided that: "Rs. 3 1 0 (comprised of Rs. 1 8 3 basic was including allowances and Rs. 1 9 O dearne6s allowance) shall be the mirlimum guar&nteed wage per dav on which a gang worker is given employment; if on any day the piece work earnings plus idle time payment andlor other earnings under this appendix fall short of the said minimum, 47 Port Trust shall make up the difference that day." "Rs. 3 7 0 (comprised of Rs. 1 14 0 basic wage including allowances and Rs. 1 9 0 dearness allowanance) shall be the minimum guaranteed wage per day on which a, morpia is given employment. " On behalf of the respondent a question was raised before us that Rule 23 of the Minimum Wages Rules does not apply to these workmen after the piece rate scheme was introduced. It is urged that for such worker there is no daily wage, as what the piece worker receives varies from day to day according to his total output. It may even happen, it is suggested, that on a certain day on which output is nil, the piece rate worker will receive nothing. Against this, Mr. Gokhale 's argument is that average daily wages during the preceding week means average of the total earnings per day during the preceding week and so there can be no difficulty in ascertaining for every his worker his average daily wages during any week. We are not prepared to accept this construction of average daily wages as average earnings per day. The daily wage has in the industrial world a definite significance in contra distinction to weekly wages or monthly wages. The weekly wages or monthly wages of a person would not as ordinarily understood include the extra earnings of the workmen by working over time. So also, in our opinion, the term daily wages as ordinarily understood does not include over time earnings. If it does not include overtime earnings, can it reasonably be said that it includes the high additional earnings, that a worker may receive by increasing his output above the minimum fixed ? We do not think that to be a reasonable interpretation of the words "daily wages. " At the same time, we see no reason why the guaranteed minimum fixed for each workman 48 per day should not be considered his daily wages. The piece rate system introduced for these work As men has fixed such a minimum. Indeed, the fixation of such A minimum wage for a piece rate system makes, it may be said the piece rate a time rate cum piece rate in which the guaranteed minimum is the time rate daily wage and the extra earnings are piece rates. The argument that Rule 23 does not apply to these workmen after the introduction of the piece rate Scheme must therefore be rejected . As regards this period also (that is, the period from March 3, 1956 onwards) Mr. Desai con. tended that there has been constructive payment of the workers as the guaranteed minimum was arrived at by dividing the monthly wage by 26 For the reasons for which this argument was rejected in respect of the period October, 1953, to March 2, l956, we reject this plea of constructive payment. We are therefore of opinion that the workers of categories A and B are entitled to arrears of wages for the Sundays from March 3, 1956 on the basis that the guaranteed minimum wage was the daily wage. As has already been mentioned, Rule 23 was amended in July 1960, i.e., long after the Tribunal gave the award under appeal. We express no opinion as to what the position in law is, after this amendment of Rule 23. The appeal is accordingly allowed in part. In the circumstances, the parties will bear their own costs in this Court.

The , and the Minimum Wages Rules, framed thereunder, laid down the principle that the Government should provide for a day of 1 est to the workers for every period of 7 days and also to make provisions for making some payment in connection therewith. The dispute between the workers and employers of the present case related to (a) arrears of wages for Sunday, the "weekly off" day on which no work was done and (b) arrears of wages for work 37 done on Sundays which should have been given as a weekly off day but was not so given and no compensatory day was given in lieu thereof as contemplated under the Minimum Wages Rules. As regards arrears of wages for Sundays on which no work was done the workmen 's case was that they were entitled to payment for each such Sunday amounts equal to their average daily wages during the preceding week, that for the work done on Sundays without the compensatory "off day" they were entitled to three times the ordinary rate. The respondent 's case was that on a proper interpretation of r. 23 of the Minimum (Wages Central) Rules, 1960, the Workmen were not entitled to payment for Sundays on which no work was done and that in any case they had been constructively paid for Sundays inasmuch as the daily wages were fixed at I/26th of the monthly wages. The Industrial Tribunal rejected all the claims of the workmen. On appeal by special leave. ^ Held, that contravention of r. 23 of the Minimum Wages Rules was punishable under the but the Industrial Tribunal had no authority to impose penalty in the shape of making the employer pay in respect of work done on Sundays something more than what he would have otherwise to pay. Neither the nor the Rules contain any provision for such additional payment over and above what would be payable for over time work as such. The workmen therefore cannot get three times the ordinary rate. The phrase "for which" in r. 23 referred to the weekly holiday whether it was on a Sunday or on any other day of the week as permitted under the Rules. No distinction was made between the holiday on the first day of the week and holiday on one of the five days immediately before or after the said day. The scheme was for one holiday in the week and it was for that holiday that payment was provided. Trustees of the Port of Bombay vs Authority under the Payment of Wages Act, (1957) I L.L.J. 627, A. C. C. vs Labour Inspector, (1960) 1 L. L. J. 192 and Jaswani Sugar Mills vs Sub divisional Magistrate, , approved. The Central Government clearly intended under the Minimum Wages Rules that for work on a holiday something more than what was actually paid for six days of the week should be paid. This could not be defeated by a statement that in form six days wages were paid, but in fact and in substance seven days wages were paid. The plea of constructive payment must fail. The argument that r. 23 did not apply to the workmen of the present case after the introduction of the piece rate scheme introduced in this case must be rejected 38

Appeals Nos. 503 to 506 of 1958. Appeals by special leave from the judgment and orders dated August 4, 1957, of the Bombay High Court in Letters patent Appeals Nos. 29 to 32, of 1957. J. C. Bhatt, R. P. Bhatt, R. A. Gagrat and G. Gopalakrishnan, for the appellants. N. C. Chatterjee, Madhowdas C. Bhagat and Radhey Lal Agarwal, for the respondents in C. A. No. 503 of 58. Madhowdas C. Bhagat and Radhey Lal Agarwal, for the respondents in C. As. 504 to 506 of 1958. September 29. The Judgment of the Court was delivered by DAS GUPTA, J. When a lessee takes lease of open land for the purpose of constructing on it buildings intended to be used for residence or for business is this "letting for residence,", or "letting for business"? That is the short question which arises for decision in these four appeals. The appellant brought these four suits in the City Civil Courts, Bombay, for recovery of arrears of rent in respect of the premises mentioned in the plaint of these several suits. It is clear under the law that the City Civil Court, Bombay, would have no jurisdiction to try these suits if the provisions of Part II of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Bom. 57 of 1947), which later in this judgment we shall refer to as the "Rent Act", applied to the permises in suits. For this reason the plaintiff stated in the plaint itself that this Rent Act did not apply to the demised premises. The defendant in each case pleaded on 930 the contrary that the Rent Act applied and so the City Civil Court had no jurisdiction to try the suits. The first issue framed in each of these suits therefore was, whether the Court had jurisdiction to entertain the suit. The learned Judge held that Part II of the Rent Act applied to the premises in each of these suits and consequently only the special court,% specified in section 28 of the Rent Act had jurisdiction to entertain the suits and the City Civil Court had no jurisdiction. Accordingly, he ordered the plaint in each of the four suits to be returned to the plaintiff for presentation to the proper Court. The plaintiff appealed to the High Court of Bombay but all the four appeals were summarily dismissed. The Letters Patent appeals preferred by the plaintiff from the decision of the Single Judge were also dismissed summarily. These appeals have been preferred against that decision of the Bombay High Court in Letters Patent Appeals on special leave obtained from this Court. Under a. 5, sub section 8 of the Rent Act unless there is anything repugnant in the context, "premises" means, among other things, "any land not being used for agricultural purposes. " It is 'undisputed in these cases that the land in respect of which the suits were brought was not being used for agricultural purposes and so comes within the definition of " 'Premises" in section 5. The provisions of Part If of the Act do not however apply to all premises which fall within this definition. Section 6 with which this Part II opens provides in its first sub section that this part shall apply to premises let for residence, education, business, trade or storage in areas specified in Sch. It is subject to a proviso that the State Government may direct that in any of the said areas, this Part shall cease to apply to premises let for any of the said purposes, with a further proviso that the State Government may again direct that in any of the said areas this Part shall re apply to premises let 931 for such of the, aforesaid purposes. As there has been no notification under these provisos affecting the premises in suit, we are not concerned with them; nor are we concerned with sub section 1(A) under Which the State Government may direct that this Part shall, apply to premises let for any other purposes. The four premises in respect of which the four suits were brought are all within the city of Bombay and thus in the area specified in Schedule of the Act. In each of these cases we have therefore to examine the, purpose of the lease and to decide whether it was let for residence or for education, business, trade or storage. The lease men tions that the leasee will construct buildings suitable for residential, business, industrial or office purposes. The plaintiff 's case is that as open land is not intended to be used as it is for residence or business but for construction of buildings for residence or business the land is not being let for residence or business. The defendant in each case contends that the letting was for residence or business as that was the ultimate purpose of taking the lease. Mr. Bhatt addressed his arguments to the question whether the letting could be said to be for residence and did not separately address us on the question of letting for business as obviously if the land could not be said to be let for residence it could not also be said to be let for business. The extreme proportion which Mr. Bhatt raised first of all on behalf of the appellant is that open land can never be let for residence and so. when a. 6 speaks of premises being let for residence, land as defined in sub section 8 (a) of section 5 is outside the word "premises". There is, in our opinion,, no substance in this contention. It is quite clear that open land as it is can be used for residence and so there is no reason to think that open land was not intended to be included in ,premises" when a. 6 speaks of premises being let for residence. 932 The more substantial question for consideration is whether when open land is being leased not to be used for residence in its condition of open land but to be used for the purpose of residence after constructing buildings thereon, the letting of the open land can reasonably be called to be letting for residence. Mr. Bhatt contends that as, what is to be considered is whether the letting of the open land is, for residence the land cannot be said to be for residence if not the open land, but, something constructed on the open land is to be used for residence. In such a case, says Mr. Bhatt, the land is let for construction of a building and not for residence. We are unable to accept this argument. Land can be used for many purposes. It maybe used for agriculture; for residence of human beings; for keeping cattle or other animals; for holding meetings; : or carrying on business or trade; for storage of goods; for supply of water by excavating tanks, and many other purposes. Many of these purposes can be achieved on the open land without the construction of any buildings. But many of them can be better achieved if some kind of structure is created on the open land. It seems reasonable to us to think that when the Bombay Legislature took particular care to include open land not being used for agricultural purposes within the word "premises" and then went on in the very next section to speak of premises being let for several specified purposes, it was thinking of the purposes to which the land will be used irrespective of whether the purpose was intended to be achieved with or without construction of a structure. The intention in mentioning only some purposes, viz., residence, education, business, trade or storage in section 6 was to exclude land let for purposes like, keeping of cattle, (except in the way of business or trade), and numerous other purposes to which the land may be put from the benefit of part II of the Act. It seems to us that when people speak ordinarily of land being let for business, they are only 933 thinking that the ultimate purpose behind the letting is that business will be carried on and they are not thinking whether the business will be carried on on the land in its present state or by the construction of temporary sheds or by putting up permanent buildings. Similarly, when a man says that he will take lease of a plot of land for storage of his goods, what he has in mind is that by taking lease of the land he will achieve the object of storing goods, irrespective of whether for such storage he will have to put up a structure or not. In the same way. , we think, that when land has been let for the purpose of constructing buildings for residence, people will say that it is being let for residence, just as they will say that the land has been let for residence if the lessee intends to use it as caravan site so that the people may live on the open land in caravans. In our opinion, the words ', 'let for residence, education, business, trade or storage" are wide enough to include a letting for the achievement of these purposes with construction of buildings as also without construction of buildings. But, says Mr. Bhatt, look at sub a. (i) of section 15 of the Rent Act which is in this very part II and that will show that the Legislature could not have intended land which is let for the construction of buildings for residence to I" within the phrase , 'premises let for residence". Section 15 of the Act after its amendment by Bombay Act 49 of 1959 reads thus: "Notwithstanding anything contained in any law, but subject to any contract to the contrary, it shall not be lawful, after the coming into operation of this Act for any tenant to sublet the whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein. " It may be mentioned that as the section originally stood the words "but subject to any contract to the contrary" were not there. When the amending Act 934 of 1959 introduced these words the amendment further provided that these words shall be deemed always to have been there. Even after the amendment, it remains unlawful, where there is no contract to the contrary, for any tenant of premises to sublet the whole or a by part thereof Mr. Bhatts argument is that in every case where there is no such contract to the contrary the difficulty that will result if land let for construction of residential buildings be held to be premises let for residence within the meaning of a. 6. is that after the building is constructed the lessee will not be able to sublet the building or any portion of it; so that in many cases where the real purpose of taking the land is for the construction of building for letting out the same, that purpose will be defeated. This argument as regards the difficulty in the matter of letting out the building constructed on the land on which lease has been taken was more plausible when the saving phrase "but subject to any contract to the contrary" did not form part of the section. Now, however, the cases in which such difficulty will arise, if at all, would be few and far between; for, it is reasonable to expect that when taking lease of land for the construction of building intended to be let out to others for residence, the lessee of the land would take care to include in the contract of lease a term permitting him to let out the building. Assuming that there may be cases where the contract of lease does not contain any such term and assuming further that it will not be lawful for the lessee of the land to let out the building constructed by him, the probability of such difficulty in some cases, can be no reason to out down the ordinary and reasonable connotation of the words , let for residence" in a. 6. It 'is unnecessary for us to decide whether if there is no contract to the contrary, section 15 will really stand in the way of a lessee of the land letting out buildings constructed by him, on such land. We may say however that there is in our opinion 935 much force in the argument which found favour with the Bombay High Court in Vinayak Goapl vs Laxman Kashinath (1), where the very question, which.is now before us arose for decision, that the bar of section 15 will operate only in the way of letting out the land of which lease has been taken, but will not stand in the way of letting the building constructed on the land. In that case the Bombay High Court held that where land is leased for the purpose of construction of buildings for residence the land is "let for residence" within the meaning of section 6 of the Rent Act. Mr. Bhatt devoted a considerable part of his argument to persuade us that some of the reasons given in that judgment do not stand scrutiny. We think it unnecessary however to examine whether all the reasons given in the judgment are correct. For, as already indicated, the words " 'let for residence" on a proper construction would cover the case of open land being let for construction of residential buildings and so the conclusion reached by the Bombay High Court in Vinayak Gopal 's Case(1) is, in our opinion, correct. It is unnecessary for us also to consider for the purpose of the present appeals as to what may happen to the sub lessee if and when on the terms of a particular lease the building ultimately vests in the owner of the land nor as to what may happen if and when on the terms of a particular lease the lessee who has constructed the building gets the right to remove the building. These considerations should not, in our opinion, affect the construction of the words "let for residence". Turning now to the facts of the present case we find that in each of these cases the lease was taken with a view to construct buildings thereon for residential, business, industrial or office purposes. The premises let am therefore "premises" to which (1) I. L. R. 936 under section 6(1) of the Rent Act the provision of part II of the Act, apply. The Trial Court and the High Court were therefore right in holding that the City Civil Court Bombay, had no jurisdiction to try the suits. The appeals are accordingly dismissed with costs. There will be one set of hearing fee for the four appeals. Appeal dismissed.

The appellant took lease of an open land for construction of buildings suitable for residential, business, industrial or office purposes. The appellant brought suits in the City Civil court, Bombay, for the recovery of arrears of rent in respect of premises built on the said open land, all within the city of Bombay thus in the area specified in Schedule I of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. The appellant stated in the Plaint itself that the Bombay Rent Control Act, 1947, did not apply to the dcmiscd premises. The defendants pleaded that the Rent Act applied and the City Civil Court had no jurisdiction to try the suit. The trial judge held that part II of the Rent Act applied to the premises and consequently only the special courts specified in section 28 of the Rent Act had jurisdiction to entertain the suit and ordered the plaints in the suits to be returned to the plaintiff, for presentation to the proper court. The Bombay High Court summarily dismissed the appeals from the said orders. The point at issue for decision was whether "when a lessee takes lease of open land for the purpose of constructing on it buildings intended to be used for residence or for business, this amounts to "Letting for residence" or "letting for business". The appellants ' contention was that as open land not intended to be used, as it is, for residence or business but for construction of buildings for residence or business was taken on lease the land was not being let for residence or business. Held, that the words "let for residence, education, business or storage" in s.6 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, are wide enough to include a letting for the achievment of these purposes by construction of buildings as also without construction of buildings. Held, further, that on the facts of the present case, in each of these cages, the lease was taken with a view to construct, buildings thereon for residential, business, industrial or office purposes and the land let was therefore 'premises ' to 929 which under section 6(1) of the Bombay Rent Act, the provisions of Part II of the Act applied. Vinayak Gopal v Laxman Kashinath I. L. R. , approved.

Civil Appeal No. 212 of 1959. Appeal from the judgment and decree dated March 1, 1957, of the calcutta High Court in appeal from original Decree No. 71 of 1954. G. section Pathak and Naunit Lal, for the appellants. A. V. Viswanatha Sastri, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondent. October 13. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This appeal by a certificate granted by the Calcutta High Court arises out of a suit filed by the three appellants against the respondent to recover Rs. 83,640/ . The three appellants are respectively the Firm Radhakrishan Shivdutt Rai which carries on business at Banaras and RamKumar Lal for himself and as karta of his joint family as well as Madan Gopal for himself and as karta of his joint family, the latter two being 83 the partners in the first mentioned Firm Radhakrishna Sivadutta Rai; for convenience we will refer to the partnership firm hereafter as the appellant. The respondent Tayeballi Dawoodbhai is a partnership firm which carries on business at Calcutta. The appellant 's case was that the appellant and the respondent had entered into a contract in the first instance on December 18, 1980, through brokers named T. N. Mehrotra & co. ,Calcutta. This contract was later confirmed by two letters written respectively on January 3 and 15, 1951, by the appellant to the respondent and replied to by the. respondent. By this contract the respondent agreed to sell 1000 bales of Banaras Hemp particulars of which were set out in the plaint. According to the appellant, by a letter written on March 14, 1951, the appellant in part performance of the said contract accepted delivery of 110 bales of Banaras Hemp No. 1 and 50 bales of Banaras Hemp No. 2; this delivery was Made by the respondent to L. N. Poddar & Co., who acted as the agent of the appellant and Paid the price of the said 160 bales. In they transaction the respondent realised Rs. 3,840 from the said I,. N. Poddar &; Co. in excess of the actual price of the goods delivered to the said company. Inspite of the repeated demands made by the appellant the respondent failed to deliver the balance of the goods contracted for and thus committed breach of the contract. That is how the appellant claimed Rs.(9,80(j as difference between the market rate on March 31, 1951, and the contract rate of the balance deliverable under the contract in suit. This amount was claimed as damages for the breach of contract. In addition an amount of Rs. 3,840 was claimed as having been paid in excess of tho value of 160 bales delivered to L. N. Poddar & Co., on behalf of the appellant. This claim was resisted by the respondent on several grounds. The principal contention urged by the respondent, however, was that in relation to 84 the contract in suit the appellant had acted as agent for its disclosed principal Messrs Khaitan and Sons Ltd., and as such it was not entitled to bring the present suit. The respondent further alleged that the said disclosed principal Messrs. Khaitan and J. Sons had settled all their rights and loams under the suit contract with their agent and so the present claim for damages was not maintainable. In regard to the claim for Rs. 3,840 tho respondent pleaded that the appellant 's case was untrue. Several other pleas were also raised but with the said pleas we are not concerned in the present appeal. Mr. Justice Bose who tried the suit framed twelve issues. On the principal point in controversy between the parties the learned judge found that the appellant had entered into the contract with the respondent on its own account and not on account of the disclosed principal as alleged by the respondent. According to the learned judge the reference to Messrs. Khaitan and Sons Ltd., made in the bought and sold notes on which the respondent 's plea was based had been inserted by the brokers "by mistake or due to some misconception. " The learned judge also found that the respondent had committed a breach of the contract as alleged by the appellant. The appellant 's case with regard to the excess payment of Rs. 3,840 made by L. N. Poddar & co. was, however, held not to have been proved. In the result a decree was passed in favour of the appellant for Rs. 79,800 along with interest as stipulated in the decree. Against this decree the respondent preferred an appeal; and the main point which was urged on its behalf was directed against the finding of the trial judge that the contract had been entered into by the appellant for itself and not on account of the disclosed principal. This contention was based in the Court of Appeal, as in the trial court, on the bought and sold notes; and it was urged that 85 the bought and sold notes clearly showed that the appellant had entered into the contract on account of the disclosed principal Messrs. Khaitan and Sons Ltd. Before the Appellate Court the respondent 's case was that the said bought and sold notes constituted the terms. Of the contract and no other evidence was relevant and admissible in order to determine the said terms. Das Gupta, J., upheld this. In his opinion the bought and sold notes issued by the brokers Constituted the sole basis for the terms. Of the contract and the two letters subsequently written on January 3 and 15, 1951, were inadmissible and irrelevant for the purpose of determining the said terms of the contract. Tho learned judge, however, considered tho matter also on the alternative basis. that the said letters could be considered for ascertaining the terms. Of the contract and came to the conclusion that can reading the said letters and the bought and sold notes together the result was the same, namely, that the contract had been entered into by the appellant on behalf of the disclosed principal. Bachawat, J., differed from Das Gupta, J., on the question about the relevance and admissibility of the two subsequent letters. According to him the two bought and sold notes. and the two letters between them constituted the terms of the contract. He was inclined to take the view that the letters could not be regarded as inadmissible or irrelevant. Reading the four documents together the learned judge. however, agreed with the conclusion alternatively recorded by Das Gupta, J., and held that the four documents supported the respondent 's plea that the appellant had entered into the contract on behalf of the disclosed principal. Both the learned judges agreed in holding that there was no evidence to support the appellants plea that the reference to the principal made in the bought and sold notes was a result of any mistake. On these findings the decree passed by the trial court was reversed and the appellant 's suit Was ordered to be dismissed. 86 In regard to the costs, however, the Appellante Could took the view that the point raised before the Appellate Court about the effect of the bought and field notes had not been specifically mooted before the trial court and that several other pleas raised by the respondent were found by the trial court to be false and so the proper older as to costs would be that each party should bear its costs throughout. After this judgement was delivered the appellant applied for and obtained a certificate from the High Court and it is with the said certificate that the present appeal has been brought before this Court. On its behalf Mr. Pathak has strenuously contended that the Appellate Court was in error in coming to the conclusion that the contracts in suit had been entered into by the appellant on behalf of the disclosed principal Messrs. Khaitan & Sons Ltd., Banaras. For the purpose of deciding this point we propose to assume in favour of the appellant that the terms of the contract may be gathered from the two bought and sold notes on which the respondent relies as well as the two subsequent letters on which the appellant relies. It would be convenient at this stage to set out the said documents. We will first refer to the brokers ' notes and the confirmation slips in respect thereon. This is how the brokers ' notes read: "T. N. Mehrotra and Co. No. 377 Hemp, Oil and Oil Seedh Pollock House Brokers. (3rd Floor) 28 A, Pollock Street. Any dispute in connection with this deal is subject to Arbitration by Bengal Chamber of Commerce. Calcutta, 18 12 1950. 87 Radhakrishna Sivadutta Rai, A/c Khetan and Sons Ltd., Shewpur, Banaras. Dear Sirs, We confirm having purchased on your account and risk under noted goods from Messrs. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta. Commodity: 500 (five hundred) bales of Banaras No. 1 only with Agmark Jan/March '51 at K. P. Docks @ Rs. 165 per bale of 400 lbs. each on receipt of the goods. Yours faithfully, For T. N. Mehrotra and Company, Sd. T. N. Mehrotra. Sales Tax number should be furnished by the Buyers otherwise to be charged." "T. N. Mehrotra and Co. No. 378 Hemp, oil and oil Seeds Pollock House Brokers (3rd Floor) Bank 4718 29 A Pollock street Tel: B.K. 1914 Calcutta, 18 12 50. Any dispute in connection with this deal is subject to arbitration by Bengal Chamber of Commerce. To: M/s. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta. Dear Sirs, We confirm having sold on your account and risk, the under noted goods, to M/s. Radakrishan Shiv Dutt Rai with A. G. Mark. A/c Khetan and Sons Ltd., Shewpur, Banaras. Commodity: (500) Five hundred Bales of Banaras No. 1 only with A. G. Mark. 88 Delivery: Jan./March 1951 at K. P. Dock. Price: @ Rs. 165 per bale of 400 Ibs. Terms of Payment on receipt of goods. Brokerage 0 8 O per bale. Sales Tax number should be finished by the buyer otherwise to be charged. Yours faithfully, For T. N. Mehrotra & Co., Sd. T. N. Mehrotra "To M/s. T. N. Mehrotra & Co., Calcutta. We acknowledge receipt of your purchase confirmation memo No. 377 dated 18 12 50. Signature: Gopal Lal Gupta For Radhakrishna Shivadutta Rai." "To M/s. T. N. Mehrotra & Co., Calcutta. We acknowledge receipt of your purchase confirmation memo. No. 378 dated 18 12 50. Signature: Gopal Lal Gupta For Radhakrishna Sivadutt Rai". The said confirmation slips were signed by Gopal Lal Gupta for the firm of Radhakrishna Shivdutt Rai. " After the said notes were sent by the brokers to the respective parties Gopal Lal Gupta on behalf of the appellant wrote a letter to the respondent on January 3, 1951, and on January 15. 1951 the respondent wrote a letter to the appellant. These letters read at follows: "Messrs. Tayeballi Dawoodbhai, 3 1 51. 20, Zakaria Street, Calcutta. Dear sirs, We have boughS from you one thousand bales of Banaras Hemp through Messrs. T. N. Mehrotra & Co., 28 A, Pollock Street, Calcutta, on the following terms: 89 1. 500 (Five hundred) bales Banaras No. 1 with agmark @ Rs. 166 (one hundred and sixtyfive) per bale of about 400 lbs. delivery K. P. Docks during January/March 1951. 2. 500 (Five hundred) bales Banaras No. II with agmark @ Rs. 145 (one hundred and fortyfive) per bale of about 400 lbs. delivery E. P. Docks during January/March 1951. Please note and confirm. Yours faithfully, for Radhakrishna Shivdutt Rai Sd. Gopal Lal Gupta." "Tayoballi Dawoodbhai 20, Zakaria Street, Registered. Calcutta 1. Calcutta, 15th January, 1951. Messrs. Radhakrishna Shivadutt Rai, Banaras. Dear Sirs, We confirm having sold to you through Messrs. T. N. Mehrotra & Co., Calcutta, 1000 (one thousand) bales of Banaras Hemp as follows: (i) 500 (Five hundred) bales Banaras Hemp No. I with Agmark at Rs. 165 per bale of about 400 Ibs. delivery K. P. Docks during January/March 1951. (ii) 500 (Five hundred) bales Banaras Hemp No. II with Agmark at Rs. 145 per bale of about 400 lbs. K. P. Docks delivery during January/March 1951. This confirms your letter of 3rd instant. Yours faithfully, for Tayeballi Dawoodbhai. x x Partner. Copy to Messrs. T. N. Mehrotra & Co., Calcutta, and to Gopinath Mehrotra, Banaras." Mr. Pathak contends that in construing the effect of the relevant documents we should not 90 attach any importance to the reference to Khaitan & Sons made in the bought and sold notes for the simple reason that the said reference is the result of a mistake or misconception on the part of the brokers. In that connection he contended that the J. finding recorded by the trial court on the issue of mistake should be accepted by us and not the finding made by the/ Appellate court. We are not impressed by this argument. In regard to these notes we have the evidence of Trilokinath and Gopinath on behalf of the brokers which negatives the theory of mistake or misconception. Trilokinath has stated on oath that when he got the offer from the respondent he telephoned to his brother Gopinath who is a broker in respect of hemp of the firm of Sewnath Gopinath and he told him about the offer. Gopinath then informed Trilokinath that the offer was closed either on the 16th or on the morning of the 17th. This information was received by Trilokinath from Gopinath on the telephone. Trilokinath was then asked about the information that his brother gave him, and he stated that his brother told him that the offer which he had communicated to him in respect of 1000 bales at Rs. 165 and. Rs. 145 had been sold by him to Khaitan Sons & Co., Fibre Ltd. He also added that he received another message from his brother either on the 18th or on the night of the 17th to prepare a contract so that it will be Khaitan & Sons through the appellant; Thus, it is clear that the evidence of Trilokinath, if believed, clearly shows that there could be no mistake or misappreciation on the part of the brokers, when the notes referred to Khaitan & Sons as principal in respect of the transaction. Gopinath substantially corroborated the evidence given by Trilokinath. He stated that when he got the offer from his brother Trilokinath he went to Deokinandan who was working for Khaitan & Sons and it was after discussion with Deokinandan thatthe souda was closed as one on behalf of Khaitan & Sons. Having thus closed this 91 contract with Deokinandan, who represented the principal Khaitan & Sons, Gopinath told Trilokinath to close the offer and asked him to prepare the note showing that the appellant was acting as agent for the disclosed principal Khaitan & Sons. Reading the evidence of the two brothers who worked as brokers in respect of the transaction in suit it is clear that any possibility of a mistake or misappreciation is wholly excluded. On behalf of the appellant Gopal Lal Gupta has given evidence. He attempted to explain away the fact that he did not protest against, or object to, the insertion of the name of Khaitan & Sons in the notes by suggesting that when he signed the confirmation slips after receiving the notes he had not noticed the reference to Khaitan & Sons. His case was that the purchase had been made by the appellant for itself and not for any other firm, and the suggestion he made was that if he had noticed that the notes had made reference to Khaitan & Sons he would either have insisted upon the said name being delete(l or would not have concluded the contract; but when his statement that he did not notice the reference to Khaitan & Sons was tested in cross examination Gopal Lal was shaken, and he had to admit that when he signed the confirmation slip he may have noticed the reference to Khaitan & Sons but he did not read the document attentively. He was, however, forced to concede that he had gone through the note before he signed the confirmation slip. It was under stress of cross examination that Gopal Lal incidentally mentioned that the reference to Khaitan & Sons may have been made by mistake. It is obvious that Gopal Lal 's evidence which otherwiee suffers from the infirmity that it is full of contradictions cannot be accepted on the question of mistake because his explanation about his conduct in signing the confirmation slips considered by itself is wholly unsatisfactory. Therefore, in our opinion, the Appellate Court was fully justified in 92 reversing the finding of the trial court on this point and in coming to the conclusion that the reference to Khaitan & Sons which the notes made was no the result of any mistake or misconception In this connection it may be relevant to refer to the attitude adopted by the appellant when the dispute arising between the parties in the present contract had gone before the Bengal Chamber of Commerce for adjudication. In those proceedings the respondent had raised the same plea that it has raised in the present suit. It was urged on its behalf that the appellant was not entitled to make ally claim on the contract because it had entered into the contract on behalf of a disclosed principal and on its account. Apparently that plea appears to have been accepted and the arbitration proceedings therefore ended as being without jurisdiction. In meeting the plea raised by the respondent it is significant that the appellant thought it fit to urge that the respondent 's allegation that the appellant was the agent of one Khaitan & Co. was not correct and that there is no firm or company known as Khaitan & Co. Or Khaitan & Sons, Ltd., or Khaitan & Sons in Shewpur, Banaras. The appellant therefore pleaded that the jurisdiction of the Chamber to entertain the case could not be disputed on that score. The appellant also alleged that the reference to Khaitan &; Sons was superfluous and no importance should be attached to the said words. In the suit itself a faint attempt was no doubt made to challenge the identity of the firm Khaitan Sc Sons, but Mr. Pathak has very fairly not attempted to raise that point before us. It would thus be noticed that the principal point made by the appellant in the arbitration proceedings before the Chamber in respect of the reference to Khaitan & Sons in the notes was entirely frivolous; no case of mistake appears to have been set out at that state. Besides, as we have already pointed out, there is no evidence on which a finding of mistake can be reasonably made in favour of the appellant. Therefore, we 93 must proceed to consider the question about the construction of the relevant documents on the basis that the reference to Khaitan & Sons which the notes make is not the result of any mistake and has been made in the ordinary course of businesss by the brokers. Let us then consider what the effect of the bought and sold notes is according to the established custom in the mercantile world. Mr. Viswanatha Sastri, for the respondent, contends that, according to the established commercial usage, if there is no variation or disparity in the bought and sold notes, the bought and sold notes issued by the brokers constitute the terms of the contract between the parties for whom the brokers act. We are inclined to accept this contention. The effect of such notes issued by the brokers has been frequently considered by judicial decisions. As early as 1846 the Privy council had occasion to deal with this question in Cowie vs Remfry (1). In that case a. C & Co and H.& Co; were merchants at Calcutta. The latter sold to the former a large quantity of indigo through the medium of a broker who drew up a sold note addressed to H.& Co. and submitted. it to H. for his approval. H. Objected to a particular word appearing in the note whereupon the broker took the sold note to C. and informed him of His objection. C. then struck his pen through the word objected to by H. placed his initials over the erasure and returned the note to the broker. The broker then delivered it in that altered form to H. & Co. Next day the broker delivered to C. & Co. a bought note which differed in certain material terms from the sold note. In an action brought by H. & Co. against C. & Co. for the breach of the contract as contained in the sold note the Supreme Court at Calcutta was of the opinion that the sold note alone formed the contract and so it decreed the plaintiff 's suit. On appeal by the defendant the Privy Council reversed (1) (1846) 3 M.I.A.448 94 the finding of the Supreme Court and held that the transaction was one of bought and sold notes and Rai held that the circumstances attending C. 's alteration of the sold note and affixing his initials were not sufficient to make that note alone a binding contract. According to the Privy Council, there being a material variation in the terms of the bought with the sold note they together did not constitute a binding contract. It would thus be seen that the Judicial Committee was dealing with a case where the bought and sold notes did not tally and so the decision was that where the bought and sold notes do not tally the sold note alone cannot constitute the terms of the contract. In dealing with this question, however, their Lordships referred to the mercantile custom in regard to the bought and sold notes and observed that "the established usage of dealing in the mercantile world should be held in high respect; the very existence of such usage shows that in practice it has been found useful and beneficial; the presumption is in its favour, and no departure from it is to be inferred from doubtful circumstances". That is why the Privy Council reached the conclusion that "this must be considered as a transaction in the contemplation of the parties by bought and sold notes, and that, the contract is contained in both of the notes, and not in one;" inevitably there being a material variation between the two notes "the consequence follows, from all legal principles, that no binding contract has been effected". This decision shows that the mercantile usage of entering into contracts evidenced by the bought and sold notes issued by the brokers was treated by the Privy Council as well recognised. The next decision to which reference may be usefully made is the case of Sievewright vs Archibald(l). In that case again there was a variation in the bought and sold notes and the variation was material, and so it was held that there was no (1) ; , 1228, 1229. 95 sufficient memorandum of a contract to satisfy the Statute of Frauds. In dealing with the question raised for the decision of the Court Lord Campbell, C. J., has made certain general observations which throw considerable light on the genesis of the bought and sold notes and the effect which is ually attributed to the said notes by commercial usage. "If the bought note case be considered a memorandum of the parol agreement", observed Lord Campbell, C. J., "so may the sold note; and which of them is to prevail ? It seems to me, therefore, that we get back to the same point at which we were when the variance was first objected, and the declaration was amended. I by no means say that where there are bought and sold notes they must necessarily be the only evidence of the contract; circumstances may be imagined in which they might be used as a memorandum of a parol agreement. Where there has been an entry of the contract by the broker in his book signed by him, I should hold without hesitation, notwithstanding some dicta, and a supposed ruling of Lord Tenterden in Thornton vs Meux (M. & M. 43), to the contrary, that this entry is the binding contract between tho parties and that a mistake made by him, when sending them a copy of it in the shape of a bought or sold note, would not affect its validity. Being authorised by the one to sel], and the other to buy, in the terms of the contract, when he has reduced it into writing and signed it as their common agent, it binds them both, according to the Statute of Frauds, as if both had signed it with their own hands; the duty of the broker requires him to do so; and till recent times, this duty was scrupulously performed by every broker. What are called the bought and sold notes were sent by him to his principals by way of information that he had acted upon their instructions, but not as the actual contract which was to be binding upon them. This; clearly appears from the practice still followed of sending the bought note to the buyer, and the sold 96 note to the seller; whereas, if these notes had been meant to constitute the contract, the bought note would be put into the hands of the seller, and the sold note into the hands of the buyer, that each might have the engagement of the other party J, and not his own. But the broker, to save himself trouble, now omits to enter and sign any contract in his book, and still sends the bought and sold notes as before. If these agree, they are held the constitute a binding contrat; if there be any material variance between them, they are both nullities, and there is no binding contract. This last proposition, though combated by the plaintiff 's counsel, has been laid down and acted upon in such a long series of oases that I could not venture to contravene it, if I did not assent to it; but, where there is no evidence of the contract unless by the bought and sold notes sent by the broker to the parties, I do not see how there can be a binding contract unless they substantially agree; for contracting parties must consent to the same terms; and where the terms in the two notes differ there can be no reason why faith should be given to the one more than the other". These observations seem to establish two propositions, first that if the bought and sold notes show a material variation neither of them nor both of them taken together can be re. lied upon for the purpose of proving the terms of the contract, and second if the bought and sold notes agree they are held to constitute a binding contract. To the same effect is the observation made by the Privy Council in Ah Shain Shoke vs Moothia Chetty,(l) when Sir Richard Couch observed that "Moothia Chetty, one of the respondents, said in his evidence he did not consider the contract as concluded until bought and sold notes were signed. He was right in this. They were the only evidence of the contract. " It is in the light of this legal position that we must consider the effect of the bought and sold (1) (1899) L. R. 27 I.A. 30 97 notes in the present case. The notes referred to the appellant and added "A/C Khaitan & Sons Ltd." There is no disparity in the notes at all; and so the two notes can be safely taken to evidence the terms of the contract. When along with the name of the appellant the notes specifically refer to a "Khaitan & Sons Ltd." with the preceding words "A/c ' ', there can be no doubt that the appellant is shown by the notes to be acting on account of the disclosed principal. The appellant realised that the effect of the reference to Khaitan & Sons in the notes would inevitably be to support the plea of the respondent that it was not entitled to bring the present action and so it pleaded that the said reference was the result of a mistake. Therefore, there can be no doubt that if the material question had to be considered in the light of the bought and sold notes alone the appellant was acting on behalf of the disclosed principal and, on the contract thus entered into, it had no right to sue end can claim no cause of action in its favour. In Gadd vs Houghton (1), James, L. J. Observed "when a man says that he is making a contract 'on account of ' some one else, it seems to me that he uses the very strongest terms the English language affords to show that he is not binding himself, but is binding his principal". In that case fruit brokers in Liverpool gave a fruit merchant a sold note which read thus: "We have this day sold to you on account of James Morand &; Co., Valentia, 2000 cases Valentia, oranges, of the brand James Morand & Co., at 12s. per case free on board", and the brokers signed the note without any addition. The purchaser brought an action against the broker for non delivery of the oranges. It was held that the words "on account of James Morand & Co." showed the intention to make the foreign principals and not the brokers liable and that the brokers were not liable upon the contract. It would be noticed that (1)(1876) 98 in dealing with the question about the brokers liability two points fell to be Gonsidered. The first point in support of fixing the liability with the brokers was that the brokers had signed this note without describing themselves as acting for the disclosed principals; and the argument was that "when a man signs a contract in his name he is prima facie a contracting party and liable and there must be something very strong on the face of the instrument to show that the liability does not attach to him". This principle was accepted by the learned judge who decided the case; but it was pointed out that there was another fact which had an overriding effect and that was that the note showed that the brokers were acting for the diclosed principal, and that fact clearly repelled the brokers ' liability in regard to the contract. In dealing with the argument about the effect of the signature Mellish, L. J. Observed "when the signature comes at the end you apply it to everything which occurs throughout the contract. If all that appears is that the agent has been making a contract on behalf of some other person, it seems to me to follow of necessity that that other person is the person liable. This is one of the simplest possible case. How can the words 'on account of Morand & Co. '. be inserted merely as a description ? The words mean that Morand & Co. are the people who have sold. It follows that the persons who have signed are merely the brokers and are not liable". We have referred to there observations made by Mellish, L. J., because as we will presently point out they would be of material assistance in deciding the point which Mr. Pathak has raised on the strength of the two subsequent letters. Thus, the bought and sold notes in this case unambiguously indicate that the appellant was acting for a disclosed principal and the contracting party was the disclosed principal and no other. It is, however, urged by Mr. Pathak that before determining the terms of the contract and the 99 parties to it we must read the notes in question along with the two letters. We have already seen the sequence of the documents. First, the notes were delivered by the brokers to the appellant and the respondent. Then the respective parties filed confirmation slips and then followed the two letters exchanged between them. Mr. Pathak contends that in its letter addressed to the respondent the apellant has definitely stated that 'they ' had bought from the respondent 1000 bales in question. Mr. Pathak places considerable emphasis on the use of the word "we" without reference to the principal; and he also relies on the fact that the letter is signed by the appellant without describing itself as acting on behalf of the principal already disclosed. Similarly he relies on the statement of the respondent 's letter to the appellant that the respondent had sold to the appellant "to you" the bales in question. According to Mr. Pathak the significance of these letters should not be underestimated in determining the parties to the contrat. There is no doubt, and indeed it is a matter of common ground before us, that the letters do not constitute all the terms of the contract, and all that is urged by Mr. Pathak is that they should be consider along with the notes. The notes refer to the fact that if any dispute arises in the deal it is subject to the arbitration by the Bengal Chamber of Commerce. They also refer to the sales tax number which is to be furnished by the buyers, otherwise they would be charged. These terms undoubtedly constitute terms of the contract; but the argument is that in the correspondence which took place between the parties there is no reference to the principal and indeed the correspondence proceeds on the basis that the appellant acts for itself and not for a disclosed principal, and that Should be borne in mind in deciding whether the appellant was acting for tho disclosed principal or not. 100 In support of his argument that the signature of the appellant to its letter of January 3, 1951, and the use of the word "we" in the first paragraph of he letter indicate that the appellant was acting for hi itself. Mr. Pathak relies on a decision of the King 'section Bench Division in H. O. Brandt & Co. vs H.N. Morris o. Ltd. (1). In that case the plaintiffs who carried on business in Manchester gave to the defendants a bought note dated September 3, 1914. This note was addressed to the defendants and was headed From Messrs. H.O. Brandt & Co., 63 Granby Row Manchester, For and on behalf of Messrs. Sayles Bleacheries, Salesville, Rhode, Island, U. section A.". The note stated "we have this day bought from you 60 tone pure an line oil" and it was signed "H. O. Brandt & Co.". The plaintiffs sued for non delivery of the oil. Their claim was resisted on the ground that they had entered into the contract on behalf of a disclosed principal and therefore were not entitled to be sued. It was held by Viscount Reading, C. J., and Scranton, L. J., Neville, J., dissenting, that the plaintiffs were the contracting parties and were entitled to sue upon the contract. The majority decision was based on three grounds. The first ground was that the plaintiffs had signed the note without describing themselves as acting on behalf of the principal and so it was held following the language used by Mellish, L. J., in the case of Gadd (2) that prima facie when a man signs a document in his own name and states therein "I have this day bought from you" he is the person liable on the contract. The second consideration was that the reference to the foreign principal was made in the note in order to declare the destination of the goods. There wax evidence adduced in the case to show that during wartime the destination of goods intended for export had to be made known. Therefore the reference to the foreign principal was treated as having been made for the purpose of meeting the said (1) (2) (1876)1 exhibit D. 357. 101 requirement; and the third circumstance was that the plaintiff 's statement at the head of the note that they were acting for and on behalf of a foreign principal could not get rid of the prima facie presumption that a person signing a contract in his own name is personally liable on it. It would thus be seen that the rule of construction which prescribes that if a person signs a contract prima facie he is the contracting party prevailed in that case because the reference to the disclosed principal was otherwise explained as serving another purpose altogether. The said rule of construction prevailed also for the additional reason that the plaintiffs were acting for a foreign principal. It would be remembered that 8. 230 of the Indian Contract Act provides that in the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them. There are, however, three cases specified in the section where such a contract would be presumed to exist; one of these cases is where a contract is made by an agent for sale or purchase of goods for a merchant resident abroad. In other words, under section 230 if an agent enters into a contract for a disclosed foreign principal the main provision of section 230 will not apply because there would be a presumption that there is a contract to the contrary under which the agent would be personally bound by the contract notwithstanding the fact that he has entered into it on behalf of a foreign principal. Therefore, we are not prepared to hold that the decision in the case of H. C. Brandt & Co. (1) lays down an unqualified rule of construction on which the appellant can rely. In fact, it may be pointed out that Neville, J., who dissented from the majority view, has significantly observed that "I rather gaudier that I should not have found myself in isolation on this point were it not for the fact that during the war there is an obligation to disclose the destination (1) [1917] 2 K.B.784. 102 of the goods". this observation shows that reference to the disclosed principal was not given its full effect in considering the question about the liability of the agent because it was held by the majority decision that the said reference was primarily, if not exclusively, made for the purposes of disclosing the destination of the goods. In support of his argument that the relevant recitals in the two letters show that the contract had been entered into by the appellant on its own behalf Mr. Pathak has also referred us to the statement of the law made by Bowstead on "Agency". "The question whether the agent is to be deemed to have contracted personally," it is observed, "in the ease of contract in writing other than a bill of exchange, promissory note, or cheque, depends upon the intention of the parties, as appearing from the terms of the written agreement as a whole, the construction whereof is a matter of a law for the Court (a) if the contract be signed by the agent in his own name without qualification, he is deemed to have contracted personally, unless a contrary intention plainly appear from other portions of the document, (b) if the agent add words to his signature, indicating that he signs as an agent, or for or on behalf of a principal, he is deemed not to have contracted personally, unless it plainly appears from other portions of the document, that, notwithstanding such qualified signature, he intended to bind himself. " In conclusion it is added that "effect should be given to every word used and none should be rejected unless it is apparent that they have been introduce per incuriam" (P. 266, article 116). These observations do not carry the appellant 's case very for because all that they show is that in determining the question as to whether the agent has entered into the contract on behalf of the principal or not the way he has signed the document has to be considered along with the other recitals made in the relevant documents. 103 What then would be the effect of the relevant recitals in the letter on which Mr. Pathak relies? In this connection it is necessary to recall that we are reading these letters along with the bought and sold notes, and that the bought and sold notes have unequivocally and clearly indicated that the appellant was acting on behalf and on account of the disclosed principal Khaitan & Sons. If we read the letters in the light of the bought and sold notes it would be clear that the signature of the appellant will not have much significance, nor would the use of the word "we" by the appellant or "you" by the respondent make any difference. Parties knew that the appellant was acting on behalf of the disclosed principal. It is not suggested that in such a case every time the agent has to sign expressly stating that he is acting on behalf of the disclosed principal. Therefore, if the appellant was acting for the disclosed principal the fact that he did not add the relevant description to his signature, or used the word "we" in the operative portion of the letter would not materially alter the fact spoken to by the notes that the appellant was acting on behalf of the disclosed principal. It cannot be suggested that these letters intended to alter the position disclosed by the notes. The letters, like the confirmation slips, are and must be, presumed to be consistent with the notes; and so it would be unreasonable to attach undue importance to the signature and to the use of the relevant words "we" and "you" on which reliance has been placed. In our opinion, therefore, the appellate Court was right in holding that even if the bought and sold notes are read along with the confirmation slips and the two letters of January 3, 1961, and January 15, 1951, the conclusion is inescapable that the appellant entered into the contract on behalf of the disclosed principal Khaitan & Sons Ltd. If that be so, it follows as a matter of law that the appellant is not entitled to bring the present suit. 104 Mr. Pathak faintly attempted to argue in the alternative that even if the appellant was acting on behalf of the disclosed principal it would be entitled to sue because from the subsequent conduct of the parties a contract to the contrary could be reasonably inferred. We have, however, not allowed Mr. Pathak to argue this point. It was conceded by the appellant before the Appellate Court that if it was held that the plaintiff firm was acting as agent for Khaitan & Sons Ltd., the suit was not maintainable. This concession was made in view of the provisions of section 236 of the Contract Act. Besides, the alternative plea which Mr. Pathak wanted to raise does not appear to have been expressly pleaded or considered in the trial court. In the result the appeal fails and is dismmissed. In the circumstances of this case we direct that the parties should bear their own costs in this Court.

The appellant sued the respondent for damages for breach of contract. The respondent pleaded that the appellant had contracted as agent for its disclosed principal and had no right to sue. The bought and sold notes issued by the brokers showed that the appellant had entered into the contract on account of the disclosed principal; but in the confirmation slips and subsequent letters exchanged between the parties no reference was made to the principal nor did the appellants describe themselves as acting or signing on his behalf. ^ Held, that it is well established in commercial usage that the bought and sold notes issued by the brokers, where 82 there is no variation or disparity between them, constitute the contract that must bind the parties. But where the bought and sold notes show material variations, neither of them nor both of them taken together can be relied upon for proving the terms of the contract. Since there was no disparity in the instant case between the two notes which specifically mentioned the appellants as acting on account of the disclosed partner, it must be held that the appellants had entered into the contract on behalf of the disclosed partner and as such was not entitled to sue. Cowie vs Ramfry, (1846) 3 Moo. I. A. 448, sievewright vs Archibald; , , Ah Shain Shoke vs Moothia Chetty (1899) L. R. 27 I. A. 30 and Gadd vs Houghton (1876) I exhibit D. 357, referred to. Held, further, that in deciding whether or not the agent had entered into the contract on behalf of the principal, the way he signed the document must be considered in the light of the recitals in the relevant document. In the instant case, the letters and the confirmation slips must be read in the light of the bought and sold notes and presumed to be consistent with them and it would, therefore, be unreasonable to attach undue importance to the signature or how the parties described themselves.

ION: Criminal Appeal No. 115 of 1959. Appeal by special leave from the judgment and order dated May 23, 1958, of the Punjab High Court in Criminal Appeal No. 414 of 1957. N.C. Chatterjee. I.M. Lal, C.L. Sareen and Mohan La1 Agarwal, for the appellant. N. section Bindra and P. D. Menon, for the respondent. October 16. The Judgment of the Court was delivered by DAS GUPTA, J. Six persons including the present appellants were tried by the Additional Sessions Judge Ferozpur on several charges in connection with the death by homicidal injuries of two brothers Munshi Singh and Hazura Singh. Of these six, Bhag Singh was the father of the other five accused persons. All the six accused persons were acquitted by the Additional Sessions Judge; on appeal by the State, the High Court of Punjab set aside the orders of acquittal in respect of Harbans Singh and Major Singh and convicted them under section 302 of the Indian Penal Code. The appeal was dissmissed in respect of the other four, viz., Bhag Singh, Gursi, Bant Singh and Gian Singh. It is against this order of conviction that Harbans Singh and Major Singh have filed the present appeal after obtaining special leave from this Court. The prosecution case is that at about 8 or 9 P.M. on July 23, 1956, shortly after Munshi Singh had returned home and complained to his father Hira Singh about the conduct of Harbans Singh and Bant Singh in abusing him. Munshi Singh ran out of his house on hearing some cries; but when he reached the Dharamshala not far from his house 107 these two appellants, along with their father Bhag Singh and their brothers Bant Singh, Gian Singh and Gursi fell upon him and caused numerous injuries with the weapons which they carried. Harbans Singh, it is said, struck Munshi Singh on the abdomen with a Sela in his hand. Munshi Singh 's brother Hazura Singh and his father Hira Singh also had followed Munshi Singh when he ran out of the house. On seeing this attack on Munshi Singh, EIazllra Singh tried to intervene, but he too was attacked and received several injuries. Harbans Singh, it is said, gave him a Sela thrust in the abdomen. Munshi Singh died on the spot; Hazura Singh was brought to the hospital at Gidderbha the following morning and received some treatment but he also died of his injuries the following day, that is, the 24th July. All the accused pleaded not guilty, the defence being that they had been falsely implicated out of enmity. To prove its Base the prosecution relied on the evidence of two persons, the deceased 's father Hira Singh and their uncle Bhag Singh and the dying declaration alleged to have been made by Hazura Singh, once in the village before Devendra Singh, the Sub Inspector of Police who had come to the village that night in connection with some other investigation and for the second time at Gidderbha hospital before a Magistrate. On a consideration of the evidence the Trial Judge came to the conclusion that the prosecution case had not been proved against any of the accused person. Being of opinion that the First Information Report had been recorded as late as 4 30 P.M. On the 24th July he thought that "the complainant party was not able to day who the assailants were and the police was making time to find out the culprits after investigation and the First Information Report was delayed on that account." He was doubtful also about the truth of the Sub Inspector 's 108 story that he actually reached the village of occurrence on that very night and consequently doubtful about any statement having been made by Hazura Singh to him on that night. In any case, he thought Hazura Singh 's dying declaration had little probative value because as many as six persons had been named and that it could not be relied upon without corroboration. The learned Judge was also not satisfied that Bhag Singh (Prosecution Witness) "was present in the village or at his house at the time of the occurrence" since "his statement was not recorded in the Inquest Report prepared by the police at midnight". The learned Judge also thought it unsatisfactory that nobody other than these two near relatives, that is, the father and uncle of the deceased persons had been examined as witnesses of the occurrence. These were the main reasons for which he came to the conclusion that the case had not been proved against any of the accused beyond reasonable doubt and accordingly acquitted the accused The High Court was of opinion that the learned Judge was wholly "wrong in holding that Bhag Singh was not mentioned in the Inquest Report"; that he had misread the time of the first Information Report as 4 30 P. M. for 4 30 A. M. and that he was again in error in concluding that "the statement made by Hazura Singh to the police on their arrival at 1 15 A.M. was inadmissible". After pointing out these "errors" in the reasoning of the learned Trial Judge the High Court said: "We have no hesitation in concluding that for the said reasons the judgment of the learned Additional Sessions Judge is wholly erroneous resulting in complete miscarriage of justice. After having gone through the testimony of both of the eye witnesses and examining the other material, particularly the two dying 109 declarations, we are of the view that the projection case was substantially true and have been proved. As regards complicity of Harbans Singh and Major Singh, there appears to be no doubt. Both of them had been assigned participation and were responsible for the fatal blow on each of the deceased. In this respect the testimony of both of the witnesses and the dying declarations are consistent. They were accordingly held guilty under section 302, Indian Penal code. " The main contention raised by Mr. Chatterjee on behalf of the appellants is that the High Court had no sufficient reasons for interfering with the order of acquittal made by the Additional Sessions Judge and that the High Court itself had been guilty of "errors", especially as the High Court has misread the judgment of the learned Additional Sessions Judge and had attributed to him statements which are not to be found in his judgment. The question as regards the correct principles to be applied by a Court hearing an appeal against acquittal of a person has engaged the attention of this Court from the very beginning. In many cases, especially the earlier ones, the Court has in laying down such principles emphasised the necessity of interference with an order of acquittal being based only on "compelling and substantial reasons" and has expressed the view that unless such reasons are present an Appeal court should not interfere with an order of acquittal. (Vide Suraj Pal Singh vs The State (1); Ajmer Singh vs State of Punjab (2); Puran vs State of Punjab (3). The use of the words "compelling reasons" embarrassed some of the High Courts in exercising their jurisdiction in appeals against acquittals and difficulties occasionally arose as to what this Court had meant by the (1) (2) [1953] section C. R. 418. 3)A.l. R. 110 words "compelling reasons". In later years the Court has often avoided emphasis on "compelling reasons" but nonetheless adhered to the view expressed earlier that before interfering in appeal with an order of acquittal a Court must examine not only questions of law and fact in all their aspects but must also closely and carefully examine the reasons which impelled the lower courts to acquit the accused and should interfere only if satisfied after such examination that the conclusion reached by the lower court that the guilt of the person has not been proved is unreasonable. (Vide Chinta vs The State of Madhya Pradesh (1); Ashrafkha Haibatkha Pathan vs The State of Bombay (2), It is clear that in emphasising in many cases the necessity of "compelling reasons" to justify an interference with an order of acquittal the Court did not in any way try to curtail the power bestowed on appellate courts under s 423 of the Code of Criminal Procedure when hearing appeals against acquittal; but conscious of the intense dislike in our jurisprudence of the conviction of innocent persons and of the facts that in many systems of jurisprudence the law does not provide at all for any appeal against an order of acquittal the Court was anxious to impress can the appellate courts the importance of bestowing special care in the sifting of evidence in appeal against acquittals. As has already been pointed out less emphasis is being given in the more recent pronouncements of this Court on "compelling reasons". But, on close analysis, it iq clear that the principles laid down by the court ill this matter have remained the same. What may be called the golden thread running through all these decisions is the rule that in deciding appeals against acquittal the Court of Appeal must examine (1) Criminal Appeal No. 178 of 1959 decided on l8 11 60. (2) Criminal Appeal No. 38 of 1960 decided on 14 12 60. 111 the evidence with particular care, must examine also the reasons on which the order of acquittal was based and should interfere with the order only when satisfied that the view taken by the acquitting Judge is clearly unreasonable. Once the appellate court comes to the conclusion that the view taken by the lower court is clearly an unreasonable one that itself is a "compelling reason" for interference. For, it is a court 's duty to convict a guilty person when the guilt is established beyond reasonable doubt, no less than it is its duty to acquit the accused when such guilt is not so established. When the High Court 's judgment shows clearly that the matter has been approached in the proper manner and the correct principles have been applied, there is very little scope for this Court to interfere with an order made by the High Court convicting an accused person in an appeal against acquittal. Once it is found that the principles laid down by this Court have been correctly applied this Court will not ordinarily embark upon a reappraisal of the evidence to ascertain whether the High Court was right in its view of the evidence. The only examination of the evidence that this Court may find itself called upon to undertake will ordinarily be just so much as is necessary to see whether the High Court has approached the question properly and applied the principles correctly. The position may however be different if the judgment of the High Court while indicating its conclusion that in its opinion the view taken by the lower court is unreasonable does not disclose a careful examination of the evidence for coming to such conclusion. Or it may appear from the High Court 's judgment that the High Court has erred on questions of law or has obviously misread the evidence on the record or the judgment of the Trial Court. What is this Court to do in such cases ? We are unable to agree 112 with Mr. Chatterjee that the only proper course for this court to take is to set aside the order made by the High Court and restore the order of acquittal. For, even where the High Court 's judgment suffers from any of these defects it may very well be that the High Court 's conclusion that the view of the lower court is unreasonable is correct. So, unless this Court thinks fit to send the case back to the High Court for re hearing of the appeal and its disposal in accordance with law, it becomes the duty of this Court in cases like these which fortunately are likely to be few in number to appraise the evidence for itself, to examine the reasons on which the lower court based the order of acquittal and then decide whether the High Court 's conclusion that the view taken by the lower Court on the question of the guilt of the accused is clearly unreasonable, is correct. If satisfied that the view was clearly unreasonable, this Court is bound to dismiss the appeal and to maintain the order of conviction made by the High Court; if on the contrary, this Court is not satisfied on such examination that the conclusion reached by the lower court that the guilt of the accused has not been proved was clearly unreasonable, the order of acquittal would be restored. The judjment of the High Court in the present case does not contain much discussion of the evidence in the case. All the discussion of the eviddnce is confined to the few sentences which we have quoted earlier in this judgment. We also notice that the learned judges of the High Court were under some misapprehension in thinking that the Additional Sessions Judge had held that Bhag Singh was not mentioned as a witness in the Inquest Report. What the Additional Sessions Judge had pointed out was that Bhag Singh 's statement had not been recorded in the Inquest Report. The Additional Sessions Judge was certainly right in this. While the High Court might have well thought that no doubt against 113 the credibility of Bhag Singh should be based on this fact that his statement was not recorded, the High Court was not justified in attributing to the Trial Judge something which he did not say. It is also not quite clear how the learned Judge said about the appellant Major Singh that he had been assigned participation and was responsible for the fatal blow on each of the deceased. In fact, neither of the two who claim to be the eye witnesses of the occurrence has said that Major Singh dealt a fatal blow on either Hazura Singh or Munshi Singh. While it is true that a general statement is made by both the witnesses as regards all the six accused having attacked both Munshi Singh and Hazura Singh neither of them has spoken of any particular injury having been caused by Major Singh. Hazura Singh himself in his dying declaration did say that Major Singh gave him a Sela blow on his left wrist but does not speak of any other injury having been caused by Major Singh either to him or to Munshi Singh except that he also said generally that all the accused gave blows on the person of Munshi Singh. The High Court has therefore clearly misdirected itself in thinking that Major Singh was responsible for any of the fatal injuries. In view of all this we consider it necessary to examine the judgment of the Trial Court and also the evidence on record ourselves for a proper decision of this appeal. Turning to the judgment of the Trial Court we find that the main circumstance which weighed with him for doubting the truth of the prosecution story is what he considered the considerable delay in recording the First Information Report. From the printed record before us we find that Narendar Nath Moharrir Head Constable, who actually entered the formal First Information Report, stated in his evidence that he made the entry at "4.30 P.M." on the 24th July 1956. It is apparently this 114 fact taken with the fact that the report did not reach the Magistrate Shri Pasricha before 8.45 P.M. on the 24th July that made the learned Judge think that the First Information was made at the Police Station at 4.30 P.M. He has unfortunately not noticed that the record of the First Information Report exhibit PP1 shows the time of record as 4.30 A.M. He also overlooked Narendranath 's own evidence in cross examination in these words: "I have perused the Roznamcha entries and find that this special report was despatched by me through Chanan Singh Foot Constable at 5.15 A.M. I cannot say why he did not deliver it to the Magistrate till 8.45 P.M." It is quite clear that 5.15 A.M. as recorded in the printed record in Narender Nath 's cross examination is not a mistake for 5.15 P.M. If that had been so there would have been no point in his saying that he could not say why the Constable did not deliver it to the Magistrate till 8.45 P.M. when this statement in cross examination is considered along with the recording of the time in exhibit PP1 itself there is no escape from the conclusion that 4.30 P.M. as stated in Narender Nath 's Examination in Chief was a slip of tongue and the correct time of the record was 4.30 A.M. and that the fact that it reached the Magistrate at 8.45 P.M. that day may well be due to the fact that the Constable was negligent and took his own time about going to the Magistrate or to some other reason not clear from the record. The reasoning of the Trial Judge based on his wrong view about the time of recording of the formal First Information Report that the complainant party was not able to say who the assailants were and so delay was made, therefore falls to the ground. The learned Judge has also misdirected himself in thinking that the dying declaration had very little probative value because as many as six accused persons had been named and that no conviction could in law be based on such dying declaration without corroboration. The law does not make any 115 distinction between a dying declaration in which one person is named and a dying declaration in which several persons are named as culprits. A dying declaration implicating one person may well be false while a dying declaration implicating several persons may be true. Just as when a number of persons are mentioned as culprits by a person claiming to be an eye witness in his evidence in court the court has to take care in deciding whether he has lied or made a mistake about any of them, so also when a number of persons appear to have been mentioned as culprits in a dying declaration that court has to scrutinise the evidence in respect of each of the accused. But it is wrong to think that a dying declaration becomes less credible if a number of persons are named as culprits. The contrary view taken in the Lahore High Court in Khurshaid Hussain vs Emperor (1) on which apparently the Trial Judge has relied is clearly erroneous. The learned Judge appears to have relied also on what was said by this Court in Ram Nath vs State of Madhya Pradesh(2) on the need of corroboration for a dying declaration. Speaking for the Court Mahajan J. (as he then was) observed in that case: "It is settled law that it is not safe to convict an accused person merely on the evidence furnished by a dying declaration without further corroboration because such a statement is not made on oath and is not subject to cross examination and because the maker of it might be mentally and physically in a state of confusion and might well be drawing upon his imagination while he was making the declaration. " The question was however considered again by this Court in Khushl Rao vs State of Bombay(3). After pointing out that in Ram Nath 's Case (Supra) the 116 Court after a careful examination of the facts of that case distinctly came to the conclusion that the dying declaration was not true and could not be relied upon this Court stated in the later case that the observations of the Court in Ram Nath 's case were in the nature of obiter dicta. The Court then proceeded to review the relevant provisions of the Evidence Act and of the decided cases in the different High Courts in India and in this Court and stated the law in these words: "that it cannot be laid down as an absolute rule of law that a dying declaration cannot form the sole basis of conviction unless it is corroborated; (2) that each case must be determined on its own facts keeping in view the circumstances in which the dying declaration was made; (3) that it cannot be laid down as a general position that a dying declaration is a weaker kind of evidence than other pieces of evidence; (4) that a dying declaration stands on the same footing as anotherpiece of evidence and has to be judged in the light of surrounding circumstances and with reference to the principles governing the weighing of evidence; (5) that a dying declaration which has been recorded by a competent magistrate in the proper manner, that is to say, in the form of questions and answers, and, as far as practicable, in the words of the maker of the declaration, stands on a much higher footing than a dying declaration which depends upon oral testimony which may suffer from all the infirmities of human memory and human character, and (6) that in order to test the reliability of a dying declaration, the Court has to keep in view the circumstances like the opportunity of the dying man for observation, for example, whether there was sufficient light if the crime was committed at night; whether the capacity of the man to remember the facts stated had not been impaired at the time he 117 was making the statement by circumstances beyond his control that the statement has been consistent throughout if he had several opportunities of making a dying declaration apart from the official record of it; and that the statement had been made at the earliest opportunity and was not the result of tutoring by interested parties. "Hence, in order to pass the test of reliability a dying declaration has to be subjected to a very close scrutiny, keeping in view the fact that the statement has been made in the absence of the accused who had no opportunity of testing the veracity of the statement by cross examination. But once the court has come to the conclusion that the dying declaration was the truthful version as to the circumstances of the death and the assailants of the victim, there is no question of further corroboration. If, on the other hand, the Court, after examining the dying declaration in all its aspects and testing its veracity, has come to the conclusion that it is not reliable by itself, and that it suffers from an infirmity, then, without corroboration it cannot form the basis of a conviction. Thus, the necessity for corroboration arises not from any inherent weakness of a dying declaration as a piece of evidence, as held in some of the reported cases, but from the fact that the court, in a given case has come to the conclusion that that particular dying declaration was not free from the infirmities referred to above or from other infirmities as may be disclosed in evidence in that case. " In view of this latest pronouncement of this Court which it should be stated in fairness to the Trial Judge was made long after he gave his judgment it must be held that it is neither a rule of law nor of prudence that a dying declaration requires to be corroborated by other evidence before a conviction can be based thereon. The evidence furnished by the dying declaration must be considered by the Judge, just as the evidence of any 118 witness, though undoubtedly some special considerations arise in the assessment of dying declarations which do not arise in the case of assessing the value of a statement made in Court by a person claiming to be witness of the occurrence. In the first place, the Court has to make sure as to what the statement of the dead man actually was. This itself is often a difficult task, specially where the statement had not been put into writing. In the second place, the court has to be certain about the identity of the persons named in the dying declaration a difficulty which does not arise where a person gives his depositions is Court and identifies the person who is present in court as the person whom he has named. Other special considerations which arise in assessing the value of dying declarations have been mentioned by this Court in Khushal Rao vs State of Bombay(1) and need not be repeated here. In view of this latest pronouncement of this Court on the question of need of corroboration of a dying declaration by other evidence, it must be held that the Trial Judge was wrong in thinking that he could not act on the dying declaration of Hazura Singh unless it was corroborated by other evidence. In view of the several defects in the reasoning of the Trial Judge, it is necessary for us to examine the evidence on the record to see whether the High Court was right in thinking that the view taken by the learned Judge was clearly unreasonable. The most important evidence in the case is furnished by the dying declaration made by Hazura Singh. The Investigating Officer, Devender Singh has said that on July 22, 1956 he had gone to the village Rikala on an excise raid and from there he went to Mallan at about 2 P.M. on July 23, to investigate a case under section 392 of the Indian Penal Code. His further evidence is that it was on the same night at about midnight that he started for Dhurkot from Mallan. We see 119 no reason to doubt the truth of his statement that he did reach Dhurkot shortly after midnight of the 23rd July and that when on hearing that a murder had taken place near the Dharamshala he came to the Dharamshala. Hazura Singh who was lying injured on a cot there made a statement to him, he recorded the statement correctly. That statement has been marked exhibit PP. The substance of this statement is that at about 9 P.M. on the night of the occurrence his brother Munshi Singh came and complained about the conduct of Bant Singh, Harbans Singh and other sons of Bhag Singh and that shortly after this on hearing shouts of Bant Singh and others near the Lharamshala, Munshi Singh went towards that place followed by Hazura Singh and his father Hira Singh and that when they reached the place they found Harbans Singh and the other accused persons all armed with weapons raising uproar and when Munshi Singh reached the place and returned the abuse Harbans Singh gave the first blow to Munshi Singh with a Sela in his hand hitting him on the front of the chest after which others of the party also gave blows and when Hazura Singh stepped forward to rescue his brother, Harbans Singh gave him a blow with a Sela in his hand which hit him on the abdomen and the other accused also gave him blows. The blow given by Major Singh hit him on his left wrist. It is clear that this statement was made by Hazura Singh shortly after midnight i.e., within about four hours after the occurrence. It has to be remembered that Hazura Singh had one single serious injury viz., the penetrating wound on his abdomen. We are satisfied from the evidence of the witnesses that there was sufficient moonlight that to enable Hazura Singh to recognize clearly the assailant who struck the blow which caused this injury. He could have therefore made no mistake about the indentity of his assailant. Nor is it likely that he 120 would within a few hours of the occurrence ascribe this fatal blow on him to somebody other than the real assailant. The several injuries on Hazura Singh and the numerous injuries on Munshi Singh justify the conclusion that there was more than one assailant in the attacking party. Whether or not Hazura Singh could have made a mistake about the identity of the other assailants or could have implicated some of them at least falsely, it will be unreasonable to think that he would substitute another person for the one assailant who gave him the fatal blow. On a consideration of these circumstances we are therefore satisfied that it would be unreasonable to doubt or disbelieve the truth of Hazura Singh 's statement when he said that Harbans Singh struck him with the Sela in his hand which hit him on the abdomen. Even if there was no other evidence on the records as regards the part taken by the appellant Harbans Singh this dying declaration of Hazura Singh is so clearly true that the only reasonable view for a judge of facts to take is that Harbans Singh caused the death of Hazura Singh by striking him with a Sela. As has already been noticed Hazura Singh in this statement mentioned Harbans Singh as the person who gave the first blow to Munshi Singh, the blow which caused one of the injuries on his chest. We can think of no reason why this main part should be ascribed falsely to Harbans Singh; we think, considering the circumstances in which the statement was made, that this part of Hazura Singh 's statement is also clearly the truth and could reasonably be accepted even without any corroboration. A second statement of Hazura Singh was recorded at the Hospital where he was removed. This statement appears to have been recorded at about midnight of the 24th July. In this statement also he mentioned Harbans Singh and the other accused persons as having taken part in the attack. It appears that when this statement was made 121 Hazura Singh 's condition was very bad. Indeed, after he had made a part of the statement the Magistrate recorded that he had started giving indifferent answers and asked the Doctor to give him the necessary treatment. After the treatment was given the statement was concluded. We would not attach much weight to this statement on the 24th July. But, it will be noticed that there is nothing in this latter statement which detracts from the truth of the earlier statement made shortly after the occurrence to the police sub Inspector. There is apart from this the testimony in Court of Hira Singh the father of the two deceased persons and his uncle Bhag Singh. As regards Bhag Singh the learned Trial Judge has pointed out that Bhag Singh 's statement was not recorded by the sub Inspector in the Inquest Report. While there is nothing in law which requires the statement of witnesses to be recorded in the Inquest Report, it appears to be a common practice in Punjab for police officers to record statements of witnesses in Inquest Reports. In the present case the Sub Inspector appears to have recorded a fairly full statement of Hira Singh as also short statements of Arjan Singh, Matha Singh and Lakal Singh in the Inquest Report itself. It is somewhat curious therefore that the Sub Inspector did not record the statement of Bhag Singh also in this report even though it is found that Bhag Singh was named as a witness of the occurrence in Hazura Singh 's dying declaration itself. It is also difficult to understand Bhag Singh 's statement that he left the place as soon as some neighbours came up after the occurrence and did not go back to the spot till he was called by the police. He has offered no explanation for this rather unusual conduct. In view of all this, we are not prepared to say that tho Trial Judge acted unreasonably in doubting his testimony. We are unable however to discover any valid reason for doubting the presence of Hira Singh at 122 the place of occurrence. It seems to us that the main reason for the Trial Judge to doubt the truth of Hira Singh 's evidence was what he considered the great delay in lodging the formal First Information Report. That reason, as we have already pointed out, does not exist. On an examination, it seems to us quite likely that Hira Singh also accompanied Hazura Singh when the latter followed Munshi Singh towards the Dharmashala and it also seems to us improbable that he would give the main part in the assault falsely to Harbans Singh if somebody else was responsible for the blow which caused Hazura Singh 's death. In our view the learned Trial Judge acted unreasonably in doubting the truth of Hira Singh 's evidence against Harbans Singh. On a consideration of the evidence we are therefore satisfied that the conclusion reached by the High Court that the view taken by the Trial Court as regards Harbans Singh 's guilt Was clearly unreasonable is correct and that the only reasonable view on the evidence can be that Harbans Singh committed murder by causing the death of Hazura Singh and also committed murder by causing the death of Munshi Singh. The position is however different as regards Major Singh. As has already been pointed out the High Court is wrong in thinking that the evidence Shows that Major Singh gave any of the fatal blows. Hazura Singh in his first dying declaration mentioned Major Singh as having given a below on him on his left wrist. Apart from Bhag Singh only Hira Singh has ascribed any specific part to Major Singh in addition to saying generally that he took part in the attack. The evidence therefore leaves scope for thinking that Hazura Singh has made a mistake about Major Singh or has wrongly implicated him. We are not therefore prepared to say that the view taken by the Trial Judge as regards Major Singh is clearly unreasonable. 123 We therefore allow the appeal of Major Singh set aside the order of conviction and sentence made against him by the High Court and restore the order of acquittal made by the Trial Court. The appeal of Harbans Singh is dismissed. Major Singh should be set at liberty at once. Appeal of appellant 2 allowed. Appeal of appellant 1 dismissed.

The High Court set aside the Trial Court 's order of acquittal of the appellants and convicted them on a charge of murder under section 302 of the Indian Penal Code. On appeal by the appellants by special leave ^ Held, that this Court in its earlier decisions emphasised that interference with an order of acquittal should be based only on "complying and substantial reasons" and held that unless such reasons were present an Appeal Court should not interface with an order of acquittal, but this Court did not try to curtail the powers of the appe11ate court under section 423 of the Code of Criminal Procedure. Though in its more recent pronouncements this Court laid less emphasis on 105 "compelling reasons" the principle has remained the same. That principle is that in deciding appeals against acquittal the Court of Appeal must examine the evidence with particular care and must also examine the reasons on which the order of acquittal was based and should interfere with the order only when satisfied that the view taken by the acquitting judge was clearly unreasonable. Once the Court came to the conclusion that the view of the lower court was unreasonable that itself was a "compelling reason" for interference. Once it was found that the High Court applied the correct principles in setting aside the order of acquittal this Court will not ordinarily interfere with the High Court 's order of conviction in appeal against acquittal o enter into the evidence to ascertain whether the High Court was right in its view of the evidence. Only such examination of the evidence would ordinarily be necessary as is needed to see that the High Court approached the question properly and applied the principle correctly. If the judgment of the High Court did not disclose a careful examination of the evidence in coming to the conclusion that the view of the acquitting court was unreasonable or if it appeared that the High Court erred on questions of law or misread the evidence or the judgment of the trial court, this Court would, unless the case was sent back to the High Court for re hearing, appraise the evidence for itself to examine the reasons on which the lower court based its order of acquittal and then decide whether the High Courts view that the conditions of the lower court was unreasonable, was correct. If on such examination it appeared to the Court that the view of the acquitting court was unreasonable the acquittal would be set aside and if on the other had it appeared that the view was not unreasonable the order of acquittal would be restored. Suraj Pal Singh vs State, , Ajmer Singh vs State of Punjab ; , Puran vs State of Punjab A.I.R. 1953 S.C. 459, Chinta vs State of M. P., Cr. A. No. 178 of 59 and Ashrafkha Haibatkha Pathan vs State of Bombay, Cr. A. No. 38 of 1960, referred to. It was neither a rule of law nor of prudence that a dying declaration should be corroborated by other evidence before a conviction could be ba ed thereon. Ram Nath vs state of M. P. A.l. R. 1953 S.C. 420, referred to. Khushal Ram vs State of Bombay, [l958] S.C.R. 552, followed. A dying declaration did not become less credible if a number of persons were names are culprits 106 Khurshaid Hussain. vs Emperor,(1941) 43 Cr.L.J.59, held erroneous.

Appeal No. 272 of 1960. Appeal from the judgment and order dated January 28, 1959, of the Rajasthan High Court in D. B. Civil Writ. Petition No. 17 of 1957. H. N. Sanyal,, Additional Solicitor General of India, R. Ganapathy Iyer, Y. section Nasarullah Sheriff, J. L. Datta and K. L. Hathi, for the appellants. G. section Pathak, Syed Anwar Hussain and B. P. Maheshwari, for respondents Nos. 1 to 7. A. G. Ratnaparkhi: for Govind saran for respondents Nos. 8 and 9. H. N. Sanyal, Additional Solicitor General of India, R. H. Dhebar and T. Jf. Sea, for the Intervener. March 17. The Judjment of the Court was delivered by 49 386 GAJENDRAGADKAR, J. In.the High Court of Judicature for Rajasthan at Jodhpur a writ petition was filed under article 226 of the Constitution by the nine respondents who are Khadims of the tomb of Khwaja Moinud din Chishti of Ajmer challenging the vires of the Durgah Khwaja Saheb Act XXXVI of 1955 (hereafter called the Act). In this petition the respondents alleged that the Act in general and the provisions specified in the petition in particular are ultra vires and they claimed a direction or an appropriate writ or order restraining the appellants the Durgah Com mittee and the Nazim of the said Committee from enforcing any of its provisions. The writ petition thus filed by the respondents substantially succeeded and the High Court has made a declaration that the impugned provisions of the Act are ultra vires and has issued an order restraining the appellants from enforcing them. The appellants then applied for and obtained a certificate from the High Court and it is with the said certificate that they have come to this Court by their present appeal. According to the respondents the shrine of Nazrat Khwaja Moin ud din Chishti which is generally known as the Durgah Khwaja Saheb situated at Ajmer is one of the most important places of pilgrimage for the muslims of India. Since persons following other religious also hold the saint in great veneration a large number of non muslims visit the tomb every year. Khwaja Saheb came to India sometime towards the end of the 12th Century A. D. and settled down in Ajmer. His saintly character and his teachings attracted a large number of devotees during his lifetime and these devotees honoured him as a great spiritual leader. Khwaja Saheb belonged to the Chishti Order of Soofies. He died at Ajmer in or about 1236 A. D., and naturally enough after his death his tomb became a place of pilgrimage. The respondents ' case further is that after his death the tomb under which the saint was interred was a kutcha structure and continued to be such for nearly 300 years thereafter. The petition alleged that a pucca structure was built by the Khilji Sultans of 387 Mandu and over the said pucca structure a tomb was constructed. Thereafter successive Muslim Rulers, particularly the Moghul Emperors, made endowments and added to the wealth and splendour of the shrine. Khwaja Syed Fukhuruddin and Sheikh Mohammad Yadgar, who originally accompanied the Khwaja Saheb Syed to India, were his close and devoted followers. After the saint 's death both of them looked after the, grave and attended to the spiritual needs of the pilgrims. The descendants of these two disciples gradually came to be known as Khadims. For generations past their occupation has been that of religious service at the tomb of Khwaja Saheb. The respondents belong to this sect or section of Khadims. They claim that they are members of a religious denomination or section known as Chishtia Soofies. Their petition further avers that throughout the centuries the Khadims had not only looked after the premises of the tomb but also kept the keys of the tomb and attended to the multitude of pilgrime who visited the shrine and acted as spiritual guides in the performance of religious functions to, wit the Fateha (act of prayer) for which they received Nazars (offerings). These Nazars were the main source of income for the livelihood of the Khadims and have in fact always constituted their property. According to the respondents the right of the Khadims to the offerings and Nazars made by pilgrims before the tomb and at the Durgah had been the subject matter of several judicial decisions and the same had been finally decided by the Privy Council in Syed Altaf Hussain vs Dewan Syed Ali Rasul Ali Khan The petition is substantially based on what the respondents regard to be the effect of the said decision in respect of their rights. According to them the rights recognised by the said decision amount to their fundamental rights to property and their fundamental right to manage the said property, and that in substance is the basis of the petition. Thus the respondents challenged the vires of the Act on the ground that its material provisions take (1) A.I.R. 1938 P.C. 71. 388 away and/or abridge their fundamental rights as a class and also the fundamental rights of the muslims belonging to the Soofi Chishtia Order guaranteed by articles 14, 19 (1) (f) and (g), 25, 26, 31(1) and (2) as well as 32. According to the case set out in the petition all Hanafi muslims do not necessarily believe in Soofism and do not belong to the Chishtia Order of Soofies, and it is to the latter sect that the shrine solely belongs; the maintenance of the shrine has also been the sole concern of the said sect. It is this sect which has to maintain the institution for religious purposes and manage its affairs according to custom and usage. That is why the respondents alleged that the material provisions of the Act, were violative of their fundamental rights. In regard to section 5 of the Act under which the Durgah Committee is constituted the respondents ' objection is that it can consist of Hanafi muslims who are not members of the Chishtia Order and that introduces an infirmity which makes the said provision inconsistent with article 26 of the Constitution. On these, allegations the respondents claimed a declaration that certain specified sections of the Act Were void and ultra vires which made the whole of the Act void and ultra vires avid they asked directions or orders or writ in the nature of mandamus or any other appropriate writ to the appellants restraining them from enforcing in any manner the said Act against them. The claim thus made by the respondents was disputed by the appellants in their detailed written statement. They averred that the circle of devotees of, and visitors to, the shrine was not confined to the Chishtia Order; but it included devotees and pilgrims of all classes of people following different religions. According to them the largest number of pilgrims and visitors 'were Hindus, Khoja Memons and parsis. It was denied that the Durgah was looked after by the descendants of Syed Fukhuruddin and Mohamad Yadgar. The allegations made by the respondents in respect of their occupation, duties and rights were seriously challenged and the case made out by them in regard to the receipt of the offerings and Nazars 389 was disputed. According to the appellants the religious services at the tomb were and are performed by the Saiiadanashin of the Durgah and the respondents had no right to look after the premises, to keep the keys of the tomb, to attend to the pilgrims visiting the shrine or to receive any offerings or Nazars. Their case was that the Khadims were and are no more, than servants of the holy tomb and their duties are similar to those of chowkidars. The appellants further pleaded that according to Islamic belief offerings made at the tomb of a dead saint are meant for the fulfilment of objects which were dear to the saint in his lifetime and they are meant for the poor, the indigent. the sick and the stiffering so that the benediction may reach the soul of the., departed saint. The averments made by the respondents in regard to their fundamental rights and their infringement were challenged by the appellants and it was urged that the Act in general and the provisions specified in the petition in particular were intra vires and constitutional. On these pleadings the High Court proceeded to consider the history of the institution, the nature of the rights set up by the respondents and the effect of the impugned legislation on those rights. The High Court has found that the offerings made before the tomb for nearly 400 years before the tomb was rebuilt into a pucca structure must have been used by the Khadims for themselves. It also held that the Khadims were performing several duties set out by the respondents and that it was mainly the Khadims who cir culated the stories of miracles performed by Khwaja Saheb during his lifetime and thus helped to spread the reputation of the tomb. Even after the tomb was rebuilt and endowments were made to it the Khadims looked after the tomb, performed the necessary rituals and spent the surplus income from the offerings for themselves. In due course Sajjanashins came to be appointed, but, according to the High Court their emergence on the scene merely enabled them to become sharers in the offerings. It has further been 390 found by the High Court on a review of judicial decisions pronounced in several disputes between the parties that the offerings made at the tomb are governed by the customary mode of their utilisation and the history of the institution proved that the said offerings have been used according to a certain custom which had been upheld by the Privy Council in the case of Syed Altaf Hussain (1). 'this custom showed that the offerings made before the shrine are divided between the Sajjadanashin and the Khadims in the manner indicated in the said decision. It is in the light of these broad findings that the High Court proceeded to examine the vires of the impugned provisions of the Act. Thus considered the High Court came to the conclusion that the several sections challenged by the respondents in their writ petition are ultra vires. It has held that section 2(b)(v) violates article 19(1)(f), section 5 violates article 26, section 11(f) articles 19(1)(g) and 25(1), sections 11(b) and 13(1) article 25, section 14 article 19(1)(f) and as. 16 and 18 article 14 read with article 32. Having found that these sections are ultra vires the High Court has issued an order restraining the appellants from enforcing the said sections. In regard to section 5 in particular the High Court has found that the said section is ultra vires inasmuch as it lays down that the Committee shall consist of Hanafi muslims without further restricting that they shall be of the Chishtia Order believing in the religous practices and ritual in vogue at the shrine. It may be added that since section 5 which contains the key provision of the Act has thus been struck down, though in a limited way, the whole of the Act has in substance been rendered inoperative. Before dealing with the merits of the appeal it would be relevant and useful to consider briefly the historical background of the dispute because, in determining the rights of the respondents and of the sect which they claim to represent, it would be necessary to ascertain broadly the genesis of the shrine, its growth, the nature of the endowments made to it, the management of the properties thus endowed, the rights of the Khadims and the Sajjadanashin in regard to (1) A.I.R. 1938 P.C. 71. 391 the tomb and the effect of the relevant judicial decisions in that behalf. This enquiry would inevitably take us back to the 13th Century because Khwaja Moin ud din died either in 1236 or 1233 A.D. and it was then that a kutcha tomb was constructed in his honour. It appears that in the High Court the parties agreed to collect the relevant material in regard to the growth of this institution which has now become scarce and obscure owing to lapse of time from the Imperial Gazetteer dealing with Ajmer, the Report of the Ghulam Hasan Committee (hereafter called the Committee). appointed in 1949 to enquire into and report on the administration of the present Durgah as well as the decision of the Privy Council in Asrar Ahmed vs Durgah Commitee, Ajmer (2). The Committee 's report shows that the Committee 'examined a large number of, witnesses belonging to several communities who were devoted to the shrine, it considered the original Sanads and a volume of other documents produced before it, took into account all the relevant judicial decisions to which its attention was drawn, and passed under review the growth of this institution and its management before it made its recommendations as to the measures necessary to secure the efficient management of the Durgah Endowment, the conservation of the shrine in the interest of the devotees as a whole. Presumbly when the parties agreed to refer to the historical data supplied by the Committee 's report they advisedly refrained from adopting the course of producing the original documents themselves in the present enquiry. The political history of Ajmer has been stormy, and through the centuries sovereignty over the State of Ajmer has changed hands with the inevitable consequence that the fortunes of 'the shrine varied from time to time. it is true that the material which has been thus placed before the Court is not satisfactory, as it could not but be so, because we are trying to trace the history of the institution since the 13th Century for nearly 600 years thereafter; but the picture which emerges as a result of a careful consideration of the (2) A. I.R 1947 P.C.I. 392 said material is on the whole clear enough for our purpose in the present appeal. Khwaja Moin ud din was born in Persia in 1143. Later he migrated with his father to Nisharpur near Meshad where Omar Khayyam is buried. Then he moved from place to place until he reached Ajmer about the end of the 12th Country. At Ajmer lie died at the ripe old age of 90. It appear,; that he retired into his cell on the First of Rajab and was found dead in the cell on the Sixth Day when it, was opened. That is why his death anniversary is celebrated every year during the six days of Rajah. He, received formal the logical education at Samarkhand and Bukhara, and in the pursuit of spiritual knowledge he travelled far and wide. Ultimately he became a disciple of Hazrat Khwaja Usman Harooin who was a well known faqir of the Chishti sect. During his lifetime the reputation of Khwaja Moinuddin travelled far and wide and attracted devotees following different religious throughout the country. At his death the saint could not have left any property and so there was no question of management of the property belonging to his tomb. No doubt the tomb itself was constructed immediately after his death but it was a kutcha structure and apparently for several years after his death there does not appear to have been endowment of property to the tomb, and so its financial position must have been of a very modest order. Persons belonging to the affluent classes were not, attracted for many years and so there was hardly any occasion to manage any property of the tomb as such. After his death the family of the saint remained in Ajmer for some time but it appears that the members of the family were driven out of Ajmer for some years and they came back only centuries later. This was the consequence of the change of rulers who exercised sovereign power over Ajmer. The construction of a pucca tomb was commenced in the reign of one of the Malwa Kings whose dynasty ruled over Ajmer up to 1531. There is no evidence to show that any property was dedicated to the tomb even then. It, however, does appear that one of the 393 Malwa Kings had appointed a Sajjadanashin to look after the tomb; this Sajjadanasliin was in later times called Dewan. The construction of the tomb took a fairly long time but even after it was completed there is no trace of any endowment of property. In or about 1560 Akbar defeated the Malwa Kings and Ajmer came under Moghul rule and so the Moghul period began. Akbar took great interest in the tomb and that must have added to the popularity of the tomb and attracted a large number of affluent pilgrims. It was about 1567 A. D. that the tomb was rebuilt and re endowed by Akbar who reigned from 1556 to 1605. A Farman issued by Akhar ascribed to the year 1567 shows that eighteen villages were granted to the Durgah. According to the report of the Committee which had access to the original Sanad and other relevant documents the year of the Sanad was not 1567 but 1575. The report also shows that the object of this first endowment was not one for the general purposes of the Durgah but for a specific purpose, namely, 'langar khana '. It appears that during this period a descendant of the saint functioned as a Sajjadanashin and he also performed the duties of a Mutawalli. There is no reliable evidence in regard to the position of the Sajjadanashin, his duties and functions before the date of Akbar, but it is not difficult to imagine that even if a Sajjadanashin was in charge of the tomb he had really very little to manage because the tomb had not until 1567 attracted substantial grants or endowments. The Committee 's report clearly brings out that the appointment of a Sajjadanashin in the time of Akbar was purely on the basis of an appointment by the State because it is pointed out that as soon as Akbar was not satisfied with the work of the Sajjadanashin appointed by him in 1567 he removed him from office in 1570 and appointed a new incumbent in his place This new incumbent carried on his duties until 1600. Similarly in 1612 Jehangir appointed a Sajjadanashin to function also as Mutawalli. During Jehangir 's time (1605 1627) some more villages were endowed to the Durgah. 50 394 During Shahjehan 's time (1627 1658) some significant changes took place in the management of the Durgah. ,The office of the Sajjadanashin was separated from that of the Mutawalli under the name of Darogah, the Mutawalli was put in charge of the management and administration of the secular affairs of the Durgah. It would also appear that some of the Daro gahs were Hindus. In his turn Shahjehan endowed several villages in favour of the Durgah. This endowment, unlike that of Akbar, was for the general purposes of the Durgah. According to the Committee Shahjehan 's endowment was in supersession of the earlier grants though it is difficult to decide as to whether it was in supersession of Akbar 's grant or of an earlier grant made by Shahjehan himself However that may be, it is quite clear that at the very time when Shahjehan made his endowment he separated the office of the Sajjadanashin from that of the Mutawalli and left it to the sole charge of the Mutawalli appointed by the Ruler to manage the properties endowed to the Durgah. The later history of the institution shows that the separate office of the Mutawalli who was in sole management of the administration of the properties of the Durgah continued ever since, and that throughout its history the Mutawallis have been appointed by the State and were as such answerable to the State and not to the sect represented by the respondents. This state of affairs continued during the reign of Aurangzeb (1659 1707). After Aarangzeb died there. was a change in the political fortunes of Ajmer because Rathor Rajputs seized Ajmer in 1719 and ruled over it for two years thereafter. This change of political sovereignty does not appear to have affected the administration of the Durgah which continued as before. In 1721 the Moghul rule was reestablished over Ajmer but that again made no change to the administration of the Durgah and the management of its properties. The Moghul rule in turn was disturbed in 1743 by the Rajput Rathors who were in power for nearly 13 years. The Rathor rule came to an end when the Scindias occupied Ajmer in 1756 and continued in 395 possession of the city until 1787. In that year the Rathors came back again and remained in possession till 1791 when Scindias overpowered them and continued to occupy it until 1818. In about 1818, after the Pindari War Ajmer passed into the hands of the East India Company and so its connection with the British Government commenced. Whilst political sovereignty over Ajmer was thus changing hands from time to time the state of affairs in relation to ' the Durgah remained as it was during the time of Shahjehan. The Sajjadanashin looked after the performance of the religious observances of the rites and the Mutawalli looked after the administration and management of the properties of the Durgah. In this connection it is relevant and significant to note that the Mutawalli has always been an officer appointed by the Government in power. That in brief is the broad picture which emerges in the light of the material placed by the parties before the Court in the present proceedings. At this stage it would be material to narrate very briefly the relevant history of legislation in regard to the administration of religious endowments which followed the assumption of political power by the British Government. The first Act to which reference must be made is Act XX of 1863. This Act was passed to enable the Government to divest itself of the management of religious endowments which had till then vested in the Revenue Boards. Section 3 of the Act provided, inter alia, that in the case, of every mosque to which the earlier regulations applied Government shall as soon as possible after the passing of the Act make special provision for the 'administration of such mosques as specified in the Act by subsequent sections Under section 4 the transfer of the administration of the said mosque and other institutions to trustees is provided with the consequence that the administration by Revenue Boards had to come to an end. Section 6 deals with the rights of the trustees to whom the property is transferred under section 4; and it also contemplates the appointment of committees which may exercise powers as therein specified. With the rest of 396 the provisions of this Act we are not concerned. The effect of this Act was that the management of religious endowments which had been taken over by the Government and which vested in the Revenue Boards was entrusted to the trustees as proscribed by section 4. In accordance with the provisions of section 6 a committee was appointed to look after the management of the Durgah with which we are concerned and that committee continued to be in. such management until 1936. In 1936 Act XXIII of 1936 was passed specifically with the object of making better provision for the administration of the Durgah and the Endowment of the Durgah of Khwaja Moin ud din Chishti known as the Durgah Khwaja Saheb, Ajmer. This Act consisted of twenty sections and in a sense it provided a self contained code for the administration of the Durgah and its endowments. Section 2(4) defines a Durgah Endowments as including (a) the Purgah Khwaja Saheb, Ajmer,(b)all buildings and movable property within the boundaries of the Durgah Sharif, (c) Durgah Jagir including all land, houses and shops and all landed property wheresoever situated belonging to the Durgah Sharif, (d) all other property and all income derived from any source whatsoever, dedicated to the Durgah or placed for any religious, pious or charitable purposes under the Durgah Administration, and (e) only such offerings as are intended explicitly for the use of the Durgah. It would be noticed that the material provisions of the Act which dealt with the management and administration of the Durgah were intended to operate in regard to the Durgah Endowment thus comprehensively defined. Under section 4 the administration and control of this endowment had to vest in a committee constituted in the manner prescribed. The powers and duties of this committee are prescribed by section 11; whereas section 16 provides for arbitration of disputes that may arise between the committee on the one hand and the sajjadanashin, the Mutawalli and the Khadim or any of them on the other. With the rest of the provisions of the Act we are not concerned. In pursuance of the material 397 provisions of this Act a Durgah Committee was appointed and it has been in management of the Durgah Endowment ever since. As we have already indicated the Government of India appointed the Committee under the Chairmanship of Mr. Justice Ghulam Hasan in 1949 to enquires into and report on the administration of the Durgah Endowment and to make appropriate recommendations to secure the conservation of the shrine by efficient management of the said Endowment. The Committee made its report on October 13, 1949, and that led to the promulgation of Ordinance No. XXIV of 1949 which was followed by Emergency Provisions Act, 1950, and finally by the Act of 1955 with which we are concerned in the present appeal. The Committee held an exhaustive enquiry, considered the voluminous evidence produced before it, reviewed the conduct of the Sajjadanashins and the Khadims, examined the manner in which the offerings were received and appropriated by them, took into account several judicial decisions dealing with the question of the rights and obligations of the said parties and came to the conclusion that "the historial review of the position leads only to the inference that the Sajjadanashins and the Khadims between themselves came to an agreement for mutual benefit and to the detriment of the Endowment and adopted a kind of a practice to realise offerings from visitors to the Durgah on a show of some charitable object and led the ignorant and the unwary into the trap" (1). The Committee has observed that most of the spokesmen before it candidly admitted the existence of many malpractices indulged in by Khadims and a majority of them showed a keen desire to introduce radical social reform in the community, provided they are backed by the authority of law (2). The Committee then commented on the agreement entered into between the Sajjadanashins and the Khadims as ampunting to ' an unholy alliance among unscrupulous persons to trade for their (1) Report of the Durgah Kbwaja Saheb (Ajmer Committee of Enquiry dated October 13, 1949, Published. by Government of India in 1950, p. 63. (2) Ibid, P. 56. 398 personal aggrandisement in the name of the holy saint, and it noticed with regret that the interest of the community had suffered more from the superstitious, ignorant and the reactionary hierarchy than from the doings of zealous reformers (1). According to the Committee "tinkering with the problem will be a remedy worse than the disease and it had no doubt that no narrow and technical considerations should stop us from marching forward". As a result of the findings made by the Committee it made specific recommen dations as to the manner in which reform should be introduced in the management and administration of the Durgah Endowment by legislative process. Speaking generally, the Act ha; been passed in the light of the recommendations made by the Committee. Thus it would be clear that from the middle of the 16th Century to the middle of the 20th Century the administration and management of the Durgah Endowment has been true to the same pattern. The said administration has been treated as a matter with which the State is concerned and it has been left in charge of the Mutawallis who were appointed from time to time by the State and even removed when they were found to be guilty of misconduct or when it was felt that their work was unsatisfactory. So far as the material produced in this case goes the Durgah Endowment which includes movable and immovable property does not appear to have been treated as owned by the denomination or section of the devotees and the followers of the saint, and its administration has always been left in the hands of the official appointed by the State. In this connection it may be relevant to refer to the decision of the Privy Council in the case of Agrar Ahmed (2). The appeal before the Privy Council in that case arose from a suit filed by Syed Asrar Ahmed against the Durgah Committee, in which he claimed a declaration that the office of the Mutawalli of the Durgah Khwaja Saheb, Ajmer, was hereditary in his family and that the Durgah Committee was not competent to question his status as a hereditary Muta walli in succession to the last holder of that office. (5) Ibid. P. 64. (2) A.I.R. 1947 P.C. I. 399 The District Judge who tried the said suit passed a decree in favour of Asrar Ahmed but on appeal the Judicial Commissioner. set aside the decree and dismissed Asrar Ahmed 's suit. On appeal by Asrar Ahmed to the Privy Council the decision of the Judicial Commissioner was confirmed. In dealing with this dispute the Privy Council has considered the genesis and growth of the shrine along with the ' stormy history of the State of Ajmer to which we have already referred. In the course of his judgment Lord Simonds observed that it was not disputed that in the reign of Emperor Shahjehan the post of Mutawalli was separated from that of Sajjadanashin and had become a Government appointment, whereas the Sajjadsnashin remained and continued to be the hereditary defendant of the saint. Then he referred to the firman of Shahjehan issued in 1629 by which the Emperor ordered that the Mutawalli appointed by the State was to sit on the left of the Sajjadanashin at the Mahfils. Similarly the firman issued by Aurangzeb in 1667 directed the order of sitting at the Mahfils by laying down that Daroga Balgorkhana, i.e., Mutawalli of the Durgah or anyone who is appointed by the State do sit on the left of the Sajjadanashin. It is significant to note that Daroga Balgorkhana was a Hindu in Akbar 's time. Having thus held that the office of the Mutawalli was an office created by the State and the holder of the office was a State servant the Privy Council examined the evidence on which Asrar Ahmed relied in support of his plea that by custom the office was hereditary and held that the said evidence did not justify the claim. This decision, supports the conclusion that the Durgah Endowment and its administration have always been in charge of the Mutawalli appointed by the State and that on occasions the post of the Mutawalli was held by a Hindu as well. Having thus reviewed brosoly the genesis of the shrine, its growth and the story of its endowments and their management, it may now be relevant to enquire what is the nature of the tenets and beliefs to which Soofism subscribes. Such an enquiry would serve to 400 assist us in determining whether the Chishtia sect can be regarded as a religious denomination or a section thereof within article 26. According to Murray T. Titus (1) "Islam, like Christianity, has its monastic orders and saints, the underlying basis of which is 'the mystic interpretation of the religious life known as Sufiism". According to this author, the men imbued with soofi doctrine came very early to India is not disputed; but who those earliest comers were or when they arrived cannot be definitely ascertained. He also expresses the opinion that though Soofism is found so extensively "it is not the religion of a sect, it is rather a natural revolt of the human heart against the cold formalism of a ritualistic religion, and so while Sufis have never been regarded as a separate sect of muslims they have nevertheless tended to gather themselves into religious orders". These have taken on special forms of Organisation, so that today there is a great number of such orders, which, curiously enough, belong only to the Sunnis. The author 'then enumerates fourteen orders or families (khandan); amongst them is the Chishtia Order. According to the report of the Committee, however, the Soofies are divided into four main silsilas; amongst them are Chishtias. The report expresses the definite opinion that the Soofi silsilas are not sects (p. 13). The characteristic feature of a particular silsila is confined to a few spiritual practices, like Aurad or Sama, to certain festivals, institutions like veneration of shrines and the devotion to certain leading personalities of the order. Soofism really denotes the attitude of mind, that is to say, a soofi while accepting all that orthodox Islam has to offer, finds lacking in it an emotive principle. According to Soofies a clear distinction has to be drawn between the real and the apparent, and they believed that the ultimate reality could be grasped only intuitively (Ma 'arifat or gnosis). A special feature of Soofi belief is divine love. An intellect, according to Soofies, performs a restricted function. The centre of spiritual life is the Qalb or the Rooh (p. 16). (1) "Indian Islam", a Religious History of Islam in India, by Murray T. Titus, published by Oxford University Press in the Series "The Religious Quest of India pp. 110, 111. 401 In Piran vs Abdool Karim (1), Ameer Ali, J., had occasion to consider the functions of the Sajjadanashin and the Mutawalli. He observed that the Sajjadanashin has certain spiritual functions to perform. He is not only a Mutawalli but also a spiritual preceptor. He is the curator of the Durgah where his ancestor is buried and in him he is supposed to continue the spiritual line (silsila). As is well known these Durgahs are the tombs of celebrated dervishes, who in their lifetime were regarded as saints. Some of these men had established Khamkahs where they lived and their disciples congregated. These dervishes professed esoteric doctrines and followed distinct systems of initiation. They were either Soofies or the disciples of Mian Roushan Bayezid who flourished about the time of Akbar and who had founded an independent esoteric brotherhood in which the chief occupied a peculiarly distinct position. The preceptor is called the pir, the disciple a murid. On the death of the pir his successor assumes the privilege of initiating the disciples into the mysteries of dervishism or Soofism. This privilege of initiation is one of the functions of the Sajjadanashin (p. 220 221). Thus on theoretical considerations it may not be easy to hold that the followers and devotees of the saint who visit the Durgah and treat it as a place of pilgrimage can be regarded as constituting a religious denomination or any section thereof. However, for the purpose of the present appeal we propose to deal with the dispute between the parties on the basis that the Chishtia sect whom the respondents purport to represent and on whose behalf (as well as their own) they seek to challenge the vires of the Act is a section or a religious denomination. This position appears to have been assumed in the High Court and we do not propose to make any departure in that behalf in dealing with the present appeal. The next point which needs to be considered is the duties of the Khadims and their rights on which their claim for an appropriate writ is based in the present (1) Cal. 51 402 proceedings. In the High Court the question about the duties of the Khadims was settled by calling upon the respondents to file an affidavit in that behalf. In accordance with the order passed by the High Court Syed Mohammed Hanis, who is one of the Khadims, made a detailed affidavit, setting forth the duties of the Khadims and the statements made in this affidavit do not appear to have been traversed at the trial. According to this affidavit, every day one Khadim in rotation opens the first gate of the dome containing the shrine at 4 a. m. after pronouncing the sacred call named the "Azan". Accompanied by a few others he then proceeds to open the second gate pronouncing certain sacred formulae in adulation of Khwaja Saheb. Then the Khadime remove the old flowers from the Mazar and put fresh flowers on it. This ceremony is called "Sej". The dome premises are then cleaned, 'Loban ' is burnt and the withered flowers are deposited in a sacred depository. This is followed by general prayer whereupon the Mazar is thrown open for the pilgrims. One Khadim remains on duty inside the dome while others guide the pilgrims. The Khadim who is present inside the dome helps the pilgrims to kiss the Mazar and prays for them, after putting the Daman, that is to say, the cloth coveting of the grave over the pilgrims ' heads. At this stage the pilgrims offer Nazar. At 3 p. m. the dome gates are closed and the flowers are changed once again. At this time the dome is given a paint of sandal paste and the Kabr Posh is also changed. The Khadim offers prayers for all the four silsilas of the Soofies and all other human beings, and this is followed by the opening of the Mazar again. At sunset there is a beat of Nakkara which gathers the pilgrims at the dome. At this time the Khadims carry lamps inside the dome, and while so doing they touch the heads of devotees with their lamps and then the lamps are placed on lamp posts. Madha (song in praise of Khwaja Saheb) is recited followed by the recitation of Dua and all pilgrims join by saying Amin. The Mazar remains open in this way until 10 p. in. when three Khadims give a, ceremonial sweep 403 thrice inside the dome and lock it for the night. Besides these daily duties the Khadims perform a special ceremony during Urs and it is called OusI. On the day, of Basant Panchami Kavvals bring fresh green plants and flowers as presents to the Mazar and they are placed on the Mazar by the Khadims on duty. That in brief is the nature of the duties performed by the Khadims in the Durgah Khwaja Saheb. Let us now consider the rights which according to the respondents have been held established by judicial decisions. In this connection the respondents rely mainly on the judgment of the Judicial Commissioner in the litigation which went before him in 1931 as well as the decision on appeal to the Privy Council in the matter. The contending parties in this litigation were the Dewan (i.e., Sajjadanashin), the Khadims and the Durgah Committee. It is not necessary for our present purpose to set out the respective contentions of the parties. It would be enough if we recite the conclusions reached by the Judicial Commissioner and mention the final decision of the Privy Council in respect of them. This is how the Judicial Commissioner recorded his conclusions at the end of his judgment in paragraph 14: "(a) The rights of the Diwan in respect of offerings made at the Durgah are declared to be as follows: (i) All offerings or presents made to the Diwan at the Diwan 's Khanqah or sitting place within the precincts of the Durgah are the exclusive property of the Diwan. (ii) Offerings or presents of gold or silver vessels or implements or Qabarposhes for the use of the Durgah are the property of the Durgah Committee as trustees for the Durgah irrespective of the payment of Tawan to the Khadims, and irrespective of the spot at which they are presented. (iii) Other offerings if made outside the dome of the Shrine are the perquisites of the Khadims, with the exception that offerings of animals or such bulky articles as cannot conveniently be brought within the dome shall, if made at the steps of the Shrine 404 be divided between the Diwan and the Khadims respectively in equal shares. (iv) Other offerings if made within the dome of the Shrine shall be divisible between the Diwan and the Khadims respectively in equal shares irrespective of the spot at which they are deposited within the dome, provided that the following class of offerings shall be the perquisites of the Khadims exclusively: (a) Copper coins and cowries and gold or silver articles (other than coins) of a value less than 8 Annas, and cotton cloth of inferior quality. (b) All offerings made between the hours of 4 a.m. and 4 p.m. on 'Qul ' day i.e. the last day of the 'Urs '. (v) Cash or other offerings sent by post shall be deemed to be offerings made at the Shrine, i.e. within the dome, unless addressed. specifically to the Durgah Committee, the Diwan or the Khadims for their exclusive use. (vi) In the case of articles falling within the scope of clause (ii) the payment of Tawan shall be deemed conclusive proof that an article is presented for the use of the Durgah and in case in which no Tawan is paid in respect of an article falling within the scope of clause (ii) the Durgah Committee shall be the authority to decide whether such article is required or should be retained for the use of the Durgah. (b) The defendant Khadims are enjoined to refrain from any interference with plaintiff 's rights as above declared. " It has been strenuously urged before us by Mr. Pathak on behalf of the respondents that the only offerings ' to which the Durgah Committee can lay a claim under this judgment are those specified in cl. (a) (ii), and he contends that these offerings are none other than the presents of, specified articles as therein indicated; in other words, the argument is that it is only offerings of certain articles for certain specific uses of the Durgah that constitute the property of the Durgah; all other offerings fall to be distributed either 405 under cl. (a)(iii) or cl. (a)(iv). If the offerings are made outside the dome with the exceptions there specified they go to the Khadims exclusively; if they are made Co,, within the dome they are to be divided between the Dewan and the Khadims in equal shares, but even in respect of such offerings those that fall within cl. (a)(iv)(a) or cl. (a)(iv)(b) have to be paid to the Khadims. Mr. Pathak thus suggests that cl. (a)(ii) refers Gaj only to specific presents given for specific purposes and the opening word "offerings" in the said clause really refers to the said presents and nothing else. We would read this clause as confined to specific presents and as excluding every other offering altogether. In our opinion this contention is unsound. In dealing with the effect of the finding recorded by the Judicial Commissioner we cannot lose sight of the fact that we are not construing terms of a statute but we are attempting to find out the effect of the findings made in judicial proceedings. The said findings cannot therefore be divested from the rest for the reasons given in the judgment, and those reasons do not support the construction suggested by Mr. Pathak. Besides, cl. (v) specifically refers to cash or other offerings Sent by post, and it provides, inter alia, that if the said cash or other offerings are addressed specifically to the Dargah Committee they would belong to the Durgah just as if they are addressed specifically to the Dewan or the Khadims they would belong to them respectively to the exclusion of anyone else. Clause (v) thus clearly postulates that cash or other offerings maybe sent by the devotees to the Durgah Committee specifically for the purposes of the Committee, and that must inevitably mean that offering may be made in cash or may take other forms, and if it is earmarked even generally for the Durgah Committee it would go to the Durgah Committee, and neither the Sajjadanashin nor the Khadim can claim any share in it. Construing the word "offerings" in cl. (a)(ii) in the light of cl. (a)(v) we are disposed to take the view that the word "offerings" includes also an offering besides presents which are specifically referred to in that clause; and so it follows that even according to the findings 406 considered as a whole, if any offerings in cash or kind are made in favour of the Durgah and in that sense earmarked for its general purposes they would belong only to the Durgah and neither the Khadim nor the Sajjadanashin can make any claim in regard to it. This matter had gone before the Privy Council in Syed Altaf Hussain vs Diwan Syed Ali Khan (1), J. Dealing with the question of the offerings and the rights of the respective parties thereto the Privy Council observed that it was conceded by the parties before the Court of Appeal that a distinction must be drawn inter alia between those articles such as Qaberposhes which are presented for the use of the Durgah and the, other offerings which are made at the Durgah; and it added that while the offerings belonging to the latter category may be divisible between the Dewan and the Khadims those made for the specific use of the Durgah are the property of the Durgah. In appreciating the effect of this observation it must be remembered that the controversy between the parties at that stage was not as to whether offerings made otherwise than in the form of specific articles but earmarked to the Durgah would belong to the Durgah or not. Even in respect of the articles specifically given to the Durgah for specific purposes the Khadims made a claim and that was rejected. This background of the dispute cannot be overlooked in judging the effect of the decision itself and observations made in. the course of the judgment. Even so, it is significant that the Privy Council specifically observed that "it appears that the offerings which are not intended for the use of the Durgah are made at various places of the buildings attached to the shrine". In other words, it would appear that the, offerings which were intended for the use of the Durgah were treated as constituting a class of offerings apart from the other offerings which were divisible between the Khadims and the Sajjadanashins, and that clearly is consistent with the view which we have taken in regard to the effect of the findings recorded by the Judicial Commissioner in appeal. The Privy Council found that Khadims who (1) A.I. R. 407 work as the servants of the Shrine were no doubt entitled to the offerings as already indicated but that they can make no claim in regard to the offerings which are intended for the use of the Durgah. At this stage we ought to examine the scheme of the Act and read its material provisions the vires of syed, which is challenged by the respondents. The Act consists of 22 sections, and like its predecessor Act Gaja XXIII of 1936 it provides a self contained Code for the administration of the Durgah and the Endowment of the Durgah. Section 2(d) defines Durgah Endowment in five clauses. The first three clauses are exactly in the same terms as the corresponding clauses of section 2(4) of the earlier Act XXIII of 1936. Clause (iv) of a. 2(d) is substantially similar to the corresponding clause in the earlier section except that it includes the Jagirdari villages of Hokran and Kishanpur in Ajmer expressly, whereas cl. (v) is somewhat differently worded. Under cl. (v) all such nazars or offerings as are received on behalf of the Durgah by the Nazir or any person authorised by him are included in the Durgah Endowment. By section 3 the provisions of the Act are given overriding effect even though they may be inconsistent with the provisions contained in Act XX of 1863. Section 4(1) deals with the appointment of the Committee in which the administration, control and management of the Durgah Endowment shall be vested. This Committee shall be called the Durgah Committee, Ajmer that is the effect of section 4(2). Section 5 prescribes the composition of the Committee. It provides that the Committee shall consist of not less than five and not more than nine members all of whom shall be Hanafi Muslims and shall be appointed by the Central Government. Section 6 deals with the terms of office and resignation and removal of members and casual vacancies. Section 7 provides for the election of the President and the Vice President of the Committee. Section 8 prescribes the conditions under which the, Committee may be superseded. Section 9 provides for the power of the Central Government to appoint a Nazim, and section 10 contemplates the appointment of an Advisory Committee to advise the 408 Nazim. Under section 11 the powers and duties of the Committee are specified. All of these powers are in (regard to the administration, control and management of the Durgah Endowment. Two of these ought to be specified because they are the subject matter of challenge. , Section 11(f) refers to the power of the Committee to determine the privileges of the Khadims and to regulate their presence in the Durgah by the grant to them of "licences in that behalf if the Committee thinks it necessary so to do", and under section 11(h) power is given to the Committee to determine the functions and powers, if any, which the Sajjadana. shin may exercise in relation to the Durgah. Under section 12 provision is made for the remuneration of the Sajjadanashin. Succession to the office of the Sajjadanashin is the subject matter of section 13. Section 13(1) provides that as soon as the office of the Sajjadanashin falls vacant, the Committee shall, with the previous approval of the Chief Commissioner, make such interim arrangements for the performance of the functions of the Sajjadailashin as it may think fit and immediately thereafter publish a notice in such form and manner as may be determined by the Committee, inviting applications for the office of the successor as therein specified. Four other sub sections of section 13 deal with the appointment of the successor but they are not the subject matter of any controversy and so it is unnecessary to refer to them. Section 14 is important. It makes it lawful for the Nazim or any person authorised by him in this behalf to solicit and receive on behalf of the Durgah any nazars or offerings from any person, and it adds that notwithstanding anything contained in any rule of law or decision to the contrary no person other than the Nazim or any person authorised by him in this behalf shall receive or be entitled to receive nazars or offerings on behalf of the Durgah. This section prohibits the Khadims or the Sajjadanashins to solicit offerings on behalf of the Durgah and is the subject matter of dispute. Section 15 enjoins upon the Committee to observe Muslim law and tenets of the Chishti saint in conducting and regulating the established rites and 409 ceremonies at the tomb. Section 16 provides for the appointment of a Board of Arbitration. If any dispute arises between the Committee on the one part c and the Sajjadanashin, any Khadim and any person claiming to be the servant of the Durgah on the other part provided such dispute does not, in the opinion of the Committee, relate to any religious usage or custom or to the performance of any religious office, it has to go before the Board of Arbitration which consists of a nominee of the Committee and a nominee of the other party to the dispute and a person who holds or has held the office or is acting or has acted as a district judge to be appointed by the Central Government. This section provides that an award of the Board shall be final, and shall not be questioned in any court. Section 16(2) lays down that no suit shall lie in any court in respect of any matter which is required by sub section (1) to be referred to a Board of Arbitration. Section 17 then lays down that any defect in the constitution of, or vacancy in, the Committee would not invalidate its acts and proceedings; and section 18 provides for the enforcement of the final orders passed by the Committee in the same manner and by the same procedure as if the said orders were a decree or order passed by a civil court in a suit. Section 19 provides for the audit of accounts and annual report, and section 20 empowers the Committee to make bye laws to carry out,, the purposes of this Act. Section 21 deals with transitional provisions, and section 22 repeals the earlier Act of 1936. That in brief is the nature and scope of the material provision, of the Act. The challenge to the vires of the Act rests broadly on two principal grounds. It is urged that its impugned provisions are inconsistent with article 26(b), (c), (d) of the Constitution and thereby violate the right to freedom of religion and to manage 'denominational institutions guaranteed by the said Article. It is also argued that some of its provisions are violative of the respondents ' fundamental right guaranteed under article 19(1)(f) and (g). It would be convenient to deal with these two principal grounds of attack before 52 410 examining the other arguments urged against the validity of different sections. We will first take the argument about the infringement of the fundamental right to freedom of religion. Articles 25 and 26 together safeguard the citizens right to freedom of religion. Under article 25(1), subject to public order, morality and health and to the other provisions of Part 111, all persons are equally entitled to freedom of conscience and their right freely to profess, practise and propagate religion. This freedom guarantees to every citizen not only the right to entertain such religious beliefs as may appeal to his conscience but also affords him the right to exhibit his belief in his conduct by such outward acts as may appear to him proper in order to spread his ideas for the benefit of others. Article 26 provides that subject to public order, morality and health every religious denomination or any section thereof shall have the right (a) to establish and maintain institutions for religious and charitable purposes; (b) to manage its own affairs in matters of religion; (c) to own and acquire movable and immovable property; and (d) to administer such property in accordance with law. The four clauses of this Article constitute the fundamental freedom guaranteed to every religious denomination or any section thereof to manage its own affairs. It is entitled to establish institutions for religious purposes, it is entitled to manage its own affairs in the matters of religion, it is entitled to own and acquire movable and immovable property and to administer such property in accordance with law. What the "expression "religious denomination" means has been considered by this Court in The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1). Mukherjea, J., as he then was, who spoke for the Court, has quoted with approval the dictionary meaning of the word "denomination" which says that a (1) ; , 1023, 1024 411 "denomination" is a collection of individuals classed,. together under the same name, a religious sect or body having a common faith and Organisation and, designated by a distinctive name". The learned Judge has added that article 26 contemplates not merely a religious denomination but also a section thereof Dealing with the questions as to what are the matters of religion, the learned Judge observed that the word "religion" has not been defined in the Constitution, and it is a term which is hardly susceptible of any rigid definition. Religion, according to him, is a matter of faith with individuals or communities and it is not necessarily theistic. It undoubtedly has its basis in a system of pleas or doctrines which are regarded by those who profess that religion as conducive to their spiritual well being, but it is not correct to say that religion is nothing else but a doctrine or belief. A religion may not only lay down a code of ethical rules for its followers to accept, it might prescribe rituals and observances, ceremonies and modes of worship which are regarded as integral parts of religion, and these forms and observances might extend even to matters of food and dress. Dealing with the same topic, though in another context, in Sri Venkataramana Devaru vs The State of Mysore (1), Venkatarama Aiyar, J. spoke for the Court in the same vein and observed that it was settled that matters of religion in article 26(b) include even practices which are regarded by the community as part of its religion, and in support of this statement the learned Judge referred to the observations of Mukherjea, J. which we have already cited. Whilst we are dealing with this point it may not be out of place incidentally to strike a note of caution and Observe that in order that the practices in question should be treated as a part of religion they must be regarded by the said religion as its essential and integral part; otherwise even purely secular practices which are not an essential or an integral part of religion are apt to be clothed with a religious form and may make a claim for being treated as religious practices within the (1) ; 412 meaning of article 26. Similarly, even practices though religious may have sprung from merely superstitious beliefs and may in that sense be extraneous and unessential accretions to religion itself. Unless such practices are found to constitute an essential and integral part of a religion their claim for the protection under article 26 may have to be carefully scrutinised; in other words, the protection must be confined to such religious practices as are an essential and an integral part of it and no other. In the present appeal we are concerned with the freedoms guaranteed under article 26(c) and (d) in particular. The respondents contend that the appointment of the Committee contemplated by sections 4 and 5 has effectively deprived the section of the denomination represented by them of its right to own the endowment properties and to them. We have already stated that we propose to deal with this appeal on the assumption that the respondents have filed the present writ petition not only for the Khadims but also for and oil behalf of the Chishtis and chat the Chishtis constitute a section of a religious denomination. Considered on this basis the contention of the respondents is directed against the powers conferred on the Committee for the purpose of administering the property of the Durgah and in substance it amounts to a challenge to the validity of the whole Act, because according to them it is for the section of the denomination to administer this property and the Legislature cannot interfere with the said right. In dealing with this argument it is necessary to recall the fact that the challenge to the vires of section 5 has been made by the respondents in their petition on a very narrow ground. They had urged that since the committee constituted under the Act was likely to include Hanafi muslims who may not be Chishtis muslims the provision authorising the appointment of the Committee was ultra vires, and in fact the decision of the, High Court is also based on this narrow ground. Now, it is clear that the vires of section 5 cannot be effectively challenged on any such narrow ground. If the right of the denomination or a section of such denomination is adversely affected by the statute the relevant 413 provision of the statute must be struck down as a whole and in its entirety or not at all. If respondents could properly invoke article 26(d) it would not be open to the statute to constitute by nomination a Committee for the management and administration of the property of the denomination at all. In others words, the infirmity or the vice in the statute cannot be cured by confining the members of the proposed Committee to the denomination itself. This no doubt is a serious weakness in the basis on which they levelled their attack against the validity of section 5 in the court below. Besides, it is significant that the property in respect of which the claim has been made by the respondents is only the property consisting of offerings made either in or outside the shrine. We have already seen that the Durgah Endowment contains several other items of property and none of these items except the offerings has been referred to in the petition, and that reasonably suggests that the respondents were conscious that the other items of properties though they formed part of the Durgah Endowment were never in the management of the denomination as such and so as to which they could legally make no claim. That is another infirmity in the claim made by the respondents in challenging the vires of section 5. However, we have allowed Mr. Pathak to argue this part of the respondents ' case on the broad and general ground that the Chishtia Soofies constitute either a denomination or a section of a denomination and as such they are entitled to administer and manage all the properties of the Durgah including the offerings to which specific reference has been made in the petition by the respondents. The challenge thus presented to the vires of section 5 and other subsidiary sections dealing with the powers of the Committee cannot succeed for the simple and obvious reason that the denomination never had the right to administer the said property in question. We have already seen how the history of the administration of the Durgah Endowment from the time the first endowment was made down to the date of the Act clearly shows that, the endowments 114 have always been made on such terms as did not confer on the denomination the right to manage the properties endowed. The management of the properties endowed was always in the hands of officers appointed by the State who were answerable to the State and who were removable by the State at the State 's pleasure. We have already seen that until Akbar made his endowment in favour of the Durgah the position of the Durgah and its properties was very modest and there was hardly any property to manage or administer. Ever since the first endowment was made and subsequent additions by similar endowments followed the administration and management of the property has been consistent with the same pattern and the said pattern excludes any claim that the administration of the property in question was ever in the hands of the said denomination. It is obvious that article 26(c) and (d) do not create rights in any denomination or its section which it never had; they merely safeguard and guarantee the continuance of rights which such denomination or its section had. In other words, if the denomination never had the right to manage the properties endowed in favour of a denominational institution as for instance by reason of the terms on which the endowment was created it cannot be heard to say that it has acquired the said rights as a result of article 26(c) and (d), and that the practice and custom prevailing in that behalf which obviously is consistent with the terms of the endowment should be ignored or treated as invalid and the administration and management should now be given to the denomination. Such a claim is plainly inconsistent with the provisions of article 26. If the right to administer the properties never vested in the denomination or had been validly surrendered by it or has otherwise been effectively and irretrievably lost to it article 26 cannot be successfully invoked. The history of the administration of the property endowed to the tomb in the present case which is spread over nearly Four Centuries is sufficient to raise a legitimate inference about the origin of the terms on which the endowments were founded, 415 an origin which is inconsistent with any rights subsisting in the denominations to administer the properties belonging to the institution. It was because the respondents were fully conscious of this difficulty that they did not adopt this broad basis of challenge in their writ petition. In considering this question it is essential to remember that the pilgrims to the tomb have at no time been confined to Chishtia Soofies nor to muslims but that in fact a large number of Hindus, Khoja Memons and Parsis visit the tomb out of devotion for the memory of the departed saint and it is this large cosmopolitan circle of pilgrims which should in law be held to be the circle of beneficiaries of the endowment made to the tomb. This fact inevitably puts a different complexion on the whole problem. We must, therefore, hold that the challenge to the vires of section 5 and the subsidiary sections which deal with the powers of the Committee on the ground that the said provisions violate the fundamental right guaranteed to the denomination represented by the respondents under article 26(c) and (d) fails. That takes us to the other principal challenge based on article 19(1)(f) and (g). This challenge is directed partly against cl. (v) in section 2(d) which defines a Durgah Endowment. We have already seen that by this clause all such Nazars or offerings as are received on behalf of the Durgah by the Nazim or any other person authorised by him are included in the Durgah Endowment. Section 14 may be read along with this definition. This section confers power on the Nazim or his agent to solicit or receive offerings on behalf of the Durgah and prohibits any other person from soliciting such offerings. The respondents contend that these Provisions infringe their fundamental right to property inasmuch as offerings or Nazars which under the custom judicially recognised would have gone to them are now sought to be diverted to the Durgah to their detriment. This argument proceeds on the assumption that it is only particular presents made for certain specific purpose of the Durgah that would belong to the Durgah and that the rest of the offerings 416 would be divisible between the Khadims and the Sajjadanashins as directed in the earlier litigation to which with have already referred. If the assumption made by the respondents was well founded that the effect of the said decision was to limit the right of the Durgah only to the receipt of the specific articles for specific purposes then of course there would have been considerable force in the argument that section 2(d)(v) and section 14 seek to augment that right and to that extent diminish or prejudicially affect the rights of the respondents. But, as we have already indicated, the decision of the Judicial Commissioner as well as that of the Privy Council do not support the claim made on behalf of the respondents. Even under the said decisions, specific articles given for specific purposes as well as offerings made for the general purposes of the Durgah and earmarked for it always belonged to the Durgah and it is only these offerings which are included within the definition of the Durgah Endowment by section 2(d)(v). Offerings or Nazars which are paid to the Durgah and as such received on behalf of the Durgah constitute Durgah Endowment and section 14 authorises the Nazim or his agent to receive such offerings and prohibit any other person from receiving them. In other words, the effect of the two provisions is that when offerings are made earmarked generally for the Durgah they belong to the Durgah and such offerings can be received only by the Nazim or his agent and by nobody else. It is clear that these offerings never belonged to the respondents and they pan therefore have no grievance against either section 2(d)(v) or section 14. That is a matter concerning the property of the Durgah and it is open to the Legislature to regulate by providing that the said offerings can be solicited by the Nazim or his agent and by no one else. The Khadims ' right to receive offerings which has been judicially recognised is in no manner affected or prejudiced by the impugned provisions. Even after the Act came into force pilgrims might and would make offerings to the Khadims and there is no provision in the Act which prevents them from accepting such offerings when made. Therefore, in our opinion, the challenge to the vires of these two provisions must also fail. 417 Before we Part with section 2(d)(v) it may be pertinent to observe that in substance the relevant portion of the definition of the Durgah Endowment is the same as in the earlier Act. Under the earlier Act only sub offerings as were intended explicitly for the use of the Durgah were included in the Durgah Endowment, while under section 2(d)(v) all Mazars and offerings which are received on behalf of the Durgah are so included. The omission of the word "explicitly" from the present definition is merely intended to make it clear that if from the nature of the offering or the circumstances surrounding the making of the offering or from other relevant facts it appears that the offering was made for the purpose of the Durgah and was accepted on behalf of the Durgah as such it would be an item of the Durgah Endowment though the offering may not have been explicitly made for the Durgah as such; but the broad idea underlying both the definitions is that where offerings are made apart from the gifts of specific articles intended for specific purposes of the Durgah and it is found that they are earmarked or intended for the Durgah for the general purposes of the institution they would constitute a part of the Durgah Endowment. Therefore the contention that by enlarging the definition of Durgah Endowment section 2(d)(v) has made an encroachment on the fundamental rights of the respondents is not at all well founded. That takes us to section 11(f) and (h). The challenge to the vires of these two provisions proceeds on the assumption that they encroach upon the fundamental right of the respondents under article 25(1). It is urged that the Committee has been given power by these provisions to determine the privileges of the Khadims as well as the, functions and powers, if any, which the Sajjadanashin may exercise in relation to the Durgah and that means infringement of, the freedom of the Khadims to practice their religion according to the custom and according to their concept. We are not impressed by this argument. What the relevant provisions intend to achieve is the regulation of the discharge of duties by the Khadims and the discharge 418 of functions and powers by the Sajjadanashin. It is common ground that the Khadims discharged their duties by rotation and that itself proves that some regulation is necessary, and so the impugned provisions merely provide for the regulation of the discharge of the duties by the Khadims and nothing more, and so the plea that the freedom to practice religion guaranteed by article 25(1) has been violated does not appear to be well founded. In this connection we ought to refer to section 15 which makes it obligatory for the Committee in exercise of its powers and discharge of its duties to follow the rules of Muslim law applicable to Hanafi muslims in India, and so all the ceremonies in the Durgah have necessarily to be conducted and regulated in accordance with the tenets of the Chishti saint. The powers conferred on the Committee by section 11 (f) and (h) must be read in the light of the mandatory provisions of section 15. Thus read the apprehension that the fundamental right to freedom of religion is infringed by the said provisions will clearly appear to be wholly unjus tified. There is yet another section which is relevant in dealing with the present point, and that is section 16. Under section 16 arbitration is provided for when disputes arise between the Committee on the one part and the Khadims and others on the other. This provision applies to all disputes except those that relate to any religious usage or custom or to the performance of any religious office. In other words, disputes in regard to secular matters are left for the decision of the arbitrators, and that, in our opinion, is a very sensible provision. The composition of the Board of Arbitration is based on well recognised principles; the two parties to the dispute name their respective nominees and an impartial member is required to be appointed on the Board with the qualifications specified by section 16(1)(iii). The argument that section 16 offends against the fundamental right guaranteed by article 14 read with article 32 seems to us to be wholly untenable. The policy underlying section 16 is in our opinion healthy and unexceptionable and so the provisions of a. 16 can be sustained 419 on the ground that they are obviously in the interest of the institution as well as the parties concerned. The provisions for compulsory adjudication by arbitration are not unknown and it would be idle to contend that they offend against article 14 read with article 32. If a dispute arises between the Committee and the Khadims in regard to a religious matter it would necessarily have to be decided in accordance with the, ordinary law and in ordinary civil courts of competent jurisdiction. Such a dispute is outside the purview of section 16; and indeed, in respect of such a dispute the Committee is not authorised to make any orders or issue any directions at all. Therefore the conclusion appears to us to be inescapable that the provisions of section 11(f) and (h) are valid and do not suffer from any constitutional infirmity. The next section which is challenged is section 13(1). The validity of this section has not been specifically attacked in the petition but even so since the whole of the Act has in a general way been challenged we have allowed Mr. Pathak to urge his arguments against the validity of section 13(1). Section 13(1) authorises the Committee to make provisional interim arrangement if a vacancy occurs in the office of the Sajjadanashin. Now, in considering the scope and effect of this provision it cannot be read apart from the provisions of the remaining sub sections of section 13. Section 13 is really intended to lay down the procedure for determining disputes as to the succession to the office of the Sajjada nashin. That is the main object of the section, but if a vacancy occurs suddenly as it always will in the case of death for instance some interim arrangement must obviously be made; and all that section 13(1) empowers the Committee to do is to make an appropriate interim arrangement in that behalf and to proceed to take the necessary steps for the appointment of a permanent successor as prescribed by the other provisions of section 13. Therefore it is futile to contend that section 13(1) offends against article 25(1) of the Constitution. Section 14 is attacked on the ground that it violates the respondents ' right to property under article 19(1)(f). We have already discussed this question in dealing 420 with section 2 (d)(v). As we have pointed out all that section 14 does is to create a statutory right in the Nazim or his agent to solicit and receive offerings on behalf of the Durgah. That does not affect the right of the respondents to receive offerings paid to them by the pilgrims visiting the Durgah. The respondents cannot possibly claim a, right, to solicit or receive offering, intended for take benefit of the Durgah. In fact no such claim has been. made in the petition and no claim can be made at ill. Therefore the validity of section 14 is not shaken by the challenge made by the respondents under article 19(1)(f). That leaves only one section to be considered and that is section 18. It is urged that section 18 also violates the fundamental rights guaranteed to the respondents under articles 14 and 32 of the, Constitution. It is difficult to appreciate the It may be conceded that section 18 is somewhat clumsily worded. The final orders whose enforcement is provided for by section 18 would appear to be final orders passed in matters within the competence of the Committee as to which no dispute is raised by the persons against when, the said orders are passed. We have already seen that if disputes arise in respect of any matters left to the jurisdiction of the Committee and they are not of a religious character then they have to be referred to arbitration provided for by section 16, and in that case it is the award passed by the board of Arbitration that would be in force. If disputes arise between the parties on any religious matters they will have to be decided in accordance with law in the ordinary civil courts of competent jurisdiction and so decisions in these disputes are also outside s.18. Thus considered the scope of section 18 would be confined only to such final orders as are passed by the committee within its jurisdiction against persons who do not object to them but who fail to comply with them. If that is the scope of section 18, as we hold it is, it is, idle to contend that either article 14 or Art.32 or the two read together are contravened. During the course of his argument Mr. Pathak emphasised the fact that though the provisions of the 421 enactment may be within the four corners of the Constitution and none of the impugned provisions may be found to be ultra vires his clients were apprehensive that in fact and in practice their rights to receive offerings would be prejudicially affected. That is a matter on which we propose to express no opinion. All that we are concerned to see is whether the legal rights of the respondents or of the section of the denomination they, seek to represent are prejudicially affected by the impugned legislation contrary to the provisions of the Constitution; and a careful examination of the relevant sections in the light of the criticisms made by Mr. Pathak against them has satisfied us that none of the impugned sections can be said to be unconstitutional. If as a result of the enforcement of the present Act incidentally more offerings are paid to the Durgah and are received on behalf of the Durgah that is a consequence which the respondents may regard as unfortunate but which introduces no infirmity in the validity of the Act. In the. result the appeal is allowed, the order issued by the High Court is set aside and the petition filed by the respondents dismissed with costs throughout. Appeal allowed.

The respondents, who were the Khadims of the tomb of Hazrat Khwaja Moin ud din Chishti of Ajmer challenged the constitutional validity of the Durgah Khwaja Saheb Act, 1955 (XXXVI of 1955) and certain specified sections by a petition filed under article 226 of the Constitution in the Rajasthan High Court. The High Court substantially found in their favour and made a declaration that the impugned provisions of the Act were ultra vires and restrained the appellants from enforcing them. The respondents claimed to represent the Chishti Soofies who, according to them, constituted a religious denomination or a section thereof to whom the Durgah belonged and their case was that the impugned Act had interfered with their fundamental right to manage its affairs. Their further case was that the Nazars (off erings) of the pilgrims constituted their customary and main source of income and were their property, recognised by judicial decisions including that of the Privy Council in Syed Altaf Hussain vs Dewan Syed Ali Rasul Ali Khan, A.I.R. , that the impugned Act and its material provisions violated their fundamental rights guaranteed by articles 14, 19(1) (f) and (g), 25, 26, 30(1) and (2) and 32 of the Constitution. It was contended that sections 4 and 5 of the Act, which provided for the setting up and composition of the Durgah Committee consisting of Hanafi Muslims none of whom might belong to the Chishtia order, infringed the rights of the. denomination guaranteed by Art, 26(b), (c) and (d) that cl. (v) of section 2(d) of the Act, by which all such Nazars as were received on behalf of the Durgah by the Nazim or any person authorised by him were to be included in the Durgah Endowment, infringed their fundamental right to property, that sections 11(f) and (h) which empowered the committee to determine the privileges of the Khadims and the functions and powers of the Sajjadanashin and section 13(1) which authorised the committee to make provisional interim arrangement in case the office of Sajjadanashin fell vacant, infringed 384 their fundamental rights under article 25(1), that section 14 by creating a statutory right in the Nazim or his agent. to solicit and receive offerings on behalf of the Durgah and prohibiting the Khadims and the Sajjadanashin from doing so, violated their right to property and section 118 which provided for the enforcement of the orders of the committee as orders and decrees of a civil court violated articles 14 and 32 of the Constitution. The past history of the Endowment for centuries showed that its management was always vested in Mutawallis appointed by the State, some of whom were Hindus, and that the pilgrims who visited the Durgah and made offering were not confined to Moslems alone but belonged to all communities. Held, that the contentions of the respondents must be nega tived. Although this Court has laid down what is a religious deno mination and what are matters of religion, it must not be overlooked that the protection of article 26 of the Constitution can extend only to such religious practices as were essential and integral parts of the religion and to no others. Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt, ; and Sri Venkataramana Devaru vs The State of Mysore, ; , discussed. Assuming that the Chishti order of Soofies constituted such a denomination or section of it whom the respondents represented, it was obvious that cls. (c) and (d) of article 26 could not create any rights which the denomination or the section never had; they could merely safeguard and guarantee the continuance of such rights which the denomination or section had. Where right to administer properties had never vested in the denomination or had been surrendered by it or had otherwise been effectively and irretrievably lost to it, article 26, could not be successfully invoked. In the instant case, since Chishti Soofies never had any rights of management over the Durgah Endowment for centuries since it was created, the attack on SS. 4 and 5 of the Act must fail. Asrar Ahmed vs Durgah Committee, Ajmer, A.I.R. 1947 P.C. 1, referred to. It was not correct to say that SS. 2(d)(v) and 14 of the impugned Act infringed article 19(1)(f) and (g) of the Constitution. Those sections, properly construed, meant that offerings earmarked generally for the Durgah belonged to the Durgah and could be received only by the Nazim or his 'agent. These offerings, as found by judicial decisions, never belonged to the respondents and the impugned sections did not affect what was found to belong to them. Syed Altaf Hussain vs Dewan Syed Ali Rasul Ali Khan, A.I.R. , referred to. 385 There could be no doubt as to the competency of the Legis lature to regulate matters relating to the property of the Durgh by providing that the said Offerings could be solicited by the Nazim or hi,, agent. It was, liower, not correct to say that the omission of the word explicitly ' contained in the definition in the earlier Act from the present Act enlarged the scope of the definition in any way. The powers conferred on the committee by section 11(f) and (h), which must be read in the light of the mandatory provisions of section 15 which made it obligatory on the committee to observe Muslim Law and the tenets of the Chishti saint and which had to be exercised within the limits laid down by section 16, could not be said to violate article 25(1) of the Constitution. section 16 in providing for the setting up of a Board of Arbitration, embodied a healthy and unexceptionable principle, obviously in the interest of the institution as well as the parties, and could not be said to infringe Arts 14 or 32 of the Constitution. Section 13(1) could not be read apart from the other provi sions of section 13. That section really intended to lay down the procedure for determining disputes relating to succession to III Office of Sajjadanashin and it was therefore fertile to contend that section 13(1) offended against article 25(1). since section 18 was confined to such final orders as were within the jurisdiction of the committee and passed against persons who did not object to them but failed to comply with them, it did not contravene articles 14 or 32 of the Constitution.

Civil Appeals Nos. 356 and 357 of 1961. Appeals by special leave and certificate from the judgment and orders dated October 16, 1959, and February 16,1960, of the Madhya Pradesh High Court in L. P. A. No. 93 of 1957 and Misc. Petition No. 254 of 1959 respectively. 152 section T. Desai and N. H. Hingorani, for the appellant. M. R. Nambiar, section N. Andley, Rameshwar Nath and P. L. Vohra, for respondent No. 1. 1960. October 20. The Judgment of the Court was delivered by HIDAYATULLAH, J. These two appeals by special leave have been filed by the Municipal Committee, Raipur, against two different respondents who carry on business of extraction of oil from oil seeds. The case involves an interpretation of the Byelaws of the Municipal Committee and the determination of octroi duty which was payable by the respondents in the relevant years of assessment on sarso oil seeds brought by them within the area of the appellant Committee for purposes of their business. The Municipal Committee demanded an ad valorem octroi duty Rs. 4 11 0 per cent from the respondents, claiming to levy it under item 44 of the Schedule of goods liable to octroi duty in the Raipur Municipality, appended to the Rules framed on June 4, 1951. The respondents, on the other hand contended that a duty of 2 annas per maund was leviable under item 4 of the same Schedule, which covered the case of oil seeds. The respondents made representations described as appeals, but were unsuccessful. Their demand for refund of octroi duty paid by them was refused and they, therefore, filed petitions under article 226 of the Constitution in the High Court of Nagpur (later, of Madhya Pradesh) against the appellants alleging inter alia that this imposition of octroi duty ad valorem at Rs. 4 11 0 percent on sarso oil seeds as against other oil seeds was ultra vires the Municipal Committee under article 14 of the Constitution. They also averred that octroi duty was properly leviable under item 4 and not under item 44. In the High Court, the petition out of which Civil Appeal No. 356 of 1961 arises, was heard by a learned single Judge, who held that 153 sarso oil seeds were chargeable to duty under item 44 and not under item 4. From the order of the learned single Judge, it does appear that the constitutional question was urged before him. Against this order, a Letters Patent Appeal was filed, and the Divisional Bench, which heard the appeal, held, disagreeing with the learned single Judge, that duty was properly leviable only under item 4. Before the Divisional Bench also, it does not appear that the constitutional question was argued. The petition, out of which Civil Appeal No. 357 of 1961 arises was heard by a Divisional Bench, which, following the earlier decision, decided against the appellant Committee. The entries in the Schedule of goods liable to octroi duty in the Raipur Municipality contain eight classes of goods. Under them are grouped 67 items, the serial numbers running consecutively through all the classes. Class I is headed "Articles of food or drink or use for men or animals". Item 4, which is in that Class reads "Oil seeds of every description not specifically mentioned elsewhere". Class V is headed "Drugs, spices and gums, toilet requisites and perfumes", and item 44 reads "Betel nuts, gums, spices, Indian herbs and Indian raw medicines and drugs, such as nuts, ilaichi, laung, jaiphal, jaipatri, dalchini., sont, katha, zeera, Dhania garlic, dry chillies, pepper, shahzeera, maithi, sarso, etc. and known as kirana" (groceries). Item 4 is chargeable to a duty of 2 annas per maund, and item 44 is chargeable ad valorem at Rs. 4 11 0 per cent. In addition to these entries, there is item 17, which reads "Vegetable oils (not hydrogenated) not provided elsewhere such as Tilli Tel, Sarso Tel, Alsi Tel, Falli Tel, Narial Tel, Andi Tel ', which are chargeable to a duty of 4 annas per maund. It is conceded on all hands that sarso is an oil seed, and if there was nothing more in the Schedule a duty of 2 annas per maund would be leviable on sarso as an oil seed. The dispute arises, because 154 sarso is mentioned again in Item 44 with a very much higher duty, and it is contended by the appellant Committee that the words "not specifically mentioned elsewhere" in item 4 exclude sarso from that item, and that its specific mention in item 44 makes it liable to the higher duty indicated there. The learned single Judge of the High Court held in favour of the Municipality. According to him, this reason was sound and the higher duty demanded was the proper duty payable. The Divisional Bench on the other hand, points out that the two classes (I and V) are entirely different. Class 1 deals with articles of food or drink for use for men and animals while Class V deals with drugs, spices and gums, toilet requisites and perfumes. The division indicates clearly that goods belonging to one category are not included in the goods belonging to the other. The Divisional Bench also points out that item 4 must be read as it stood and the specific mention must be in the same manner in which that entry was framed. Item 4 deals with "oil seeds", and the specific mention must be as "oil seeds" elsewhere in the Schedule. It was also argued for the respondents that "elsewhere" meant elsewhere in the same Class. But the appellant Committee pointed out that the serial numbers were all consecutive, and that the specific mention could be anywhere in the Schedule. The two arguments are equally plausible, and nothing much, therefore turns upon them. In our opinion, the Divisional Bench of the High Court was right when it said that the specific mention elsewhere must be as oil seeds and not as something else. Class V deals with spices and groceries and the concluding words of item 44 known as "kirana" determine the ambit of that item. Though sarso might be mentioned there, it must be taken to have been mentioned as a spice or as kirana and not as oil seed. The extent of item 4, which deals with oil seeds of every descrip 155 tion, could only be cut down by a specific mention elsewhere of an item as an oil seed. Item 44 contains fairly long list, out of which we have quoted a few illustrative items. Each of these items is referable to the general heading either as a drug or a spice or gum, etc. Sarso, it is admitted, is sold as kirana and as a spice. The mention of sarso there is limited by the general heading to which it belongs, namely, a spice, drug or herb sold as kirana. No doubt, sarso as an oil seed is the same article as sarso sold as kirana but we must take into account the intention behind the bye law and give effect to it. If it was intended that sarso as an oil seed was to be taxed in a special way, it would be reasonable to expect that it would have be found a specific in mention as an oil seed with a different duty. One would not expect that it would be included in a long list of articles of kirana and in this indirect way be taken out from a very comprehensive entry like item 4, where oil seeds of every description are mentioned. Though the next argument is not conclusive because there is no logic behind a tax, still it is to be noticed that sarso oil (a maund of which, as the affidavit of the respondents shows, is expressed from three maunds of oil seed) bears only an octroi duty of 4 annas per maund, while three maunds of sarso oil seed under item 44, if it were applicable, bear a duty of Rs. 4 3 6 per maund, if the price of sarso is taken as Rs. 30 per maund as stated in the affidavit. This leads to an anomaly, which, in our opinion, could hot have been intended. Finally, it may be said that if there be any doubt, the Divisional Bench of the High Court very properly resolved it in favour of the taxpayer. We, therefore, hold that the judgment of the High Court is correct, and dismiss these appeals with costs. Appeals dismissed,.

The respondents carried on business of extraction of oil from oil seeds. The appellant Municipality charged octroi duty at Rs. 4 11 0 percent ad valorem under item 44 of the schedule of goods attached to the Rules framed by the Municipality. The respondent 's case was that they were liable to pay octroi under item 4 of the said Rules at the rate of 2 as. per maund. The schedule consisted of eight classes with 67 items of goods, the serial number running consecutively. Class I was headed "Articles of food or drink or use for men or animals". Item 4, which was in that class, read "oil seeds every description not specifically mentioned else where". Class V was headed "Drugs, spices and gums, toilet requisites and perfumes" and item 44 which was in that class read "betel nuts, gums, spices, sarso etc. and known as kirana" (groceries). 'I`he single Judge who heard the matter in the first instance held in favour of the appellant but the court of appeal held in favour of the respondent. ^ Held, that the view taken by the Court of appeal must be upheld. The words not specifically mentioned elsewhere" in item 4 of the Schedule must mean mention as an oil seed. The words "known as Kirana" in item 44 clearly indicated that sarso fell within its ambit only as a spice or as Kirana and not as an oil seed. Although there could be no doubt that sarso as an oil seed was the same thing as Kirana, but the intention behind the bye law to charge oil seeds at a lesser rate was clear and must be given effect to.

Appeal No. 153 of 1951. Appeal from the Judgment and Decree dated 2nd January, 1946, of the Chief Court of Auadh in First Civil Appeal No. 9 of 1940 arising out of the Decree dated 6th November, 1939, of the Court of Civil Judge in Regular Suit No. 36 of 1937. Bakshi Tek Chand (Onkar Nath Srivstava, with him) for the appellants. Achhru Ram (Bishan Singh, with him) for the respondents. January 23. The Judgment of the Court was delivered by BHAGWATI J. This is an appeal from the judgment and decree passed by the late Chief Court of Oudh, affirming the judgment and decree passed by the Civil Judge of Sitapur, dismissing the plaintiffs ' suit. One, Thakur Shankar Bux Singh, proprietor of the Estate known as Rampur Kelali, situated in District Sitapur (Oudh) was heavily indebted and the estate had been in the possession of Deputy Commissioner of Sitapur as receiver from 1892 up to 11th July, 1901. Thereafter he was declared a disqualified proprietor under the provisions of Section 8 (D) (1) of the U.P. Court of Wards Act (U.P. Act III of 1899) and the Court of Wards took possession of the estate on the 1st August, 1901. Under Section 34 of the Act he was 916 not competent to dispose his property by will without the consent in writing of the Court of Wards, though prior to the 1st August, 1901, he had made four successive wills, the last being dated 19th June, 1901, under which he gave his estate absolutely to his wife. On the 30th November, 1901, he made a will giving a life interest to his wife and the remainder over to his cousin Ganga Bux Singh after providing for certain legacies by way of maintenance in favour of his three daughters, his father 's sister and his mother. The Court of Wards withheld its consent to this will which thus fell through. On the 7th January, 1904, Ganga Bux Singh executed in his favour a registered deed of agreement agreeing to pay him Rs. 50 per month during his lifetime with effect from the month in which he would execute a will in favour of Ganga Bux Singh and his sons and submit the same for sanction of the Members of the Board of Revenue. A draft of the will was accordingly prepared by him on the 18th January, 1904, under which he gave a life interest to his wife and the residue of the property to Ganga Bux Singh and after him to his sons after providing legacies for maintenance in favour of his daughters, father 's sister and mother. The Board of Revenue intimated on the 25th May, 1904, that it would not withhold its consent to a will similar to that contained in the draft but altered in the light of the proposals contained in the further letter dated 27th April, 1904. He thereupon duly made and published a will on the 28th July, 1904, in accordance with the suggestions contained in the Board 's letter dated 25th May, 1904, cancelling all the previous wills executed by him. It appears that he handed over the original of this will to Ganga Bux Singh but did not give any intimation of the execution thereof to the authorities and the authorities could only come to know of the same when Ganga Bux Singh gave the original will to the Special Manager on or about the 19th December, 1905. He appears to have changed his mind thereafter and having embraced Christianity intended to marry a Christian woman and submitted to the Court of Wards on the 8th June, 1906, the draft of a new will which he 917 intended to execute in favour of his Christian wife. The Board withheld its consent to that new will and intimated on the 13th July, 1906, its refusal and also communicated thereby the withholding of its consent to the will already executed by him on the 28th July, 1904. A further attempt by him on the 21st November, 1906, to obtain the consent of the Court of Wards to another draft will was also unsuccessful and the will dated the 28th July, 1904, was the only last will and testament executed by him and got registered after consent obtained from the Court of Wards. Shankar Bux Singh died thereafter on the 28th July, 1922, and he being a Christian at the time of his death successsion to his property was governed by the Indian Succession Act. His wife got 1/3rd of the estate and the remaining 2/3rds were divided in equal shares between his surviving daughter and the son of a predeceased daughter of his. Mutation was effected in the records of rights and the name of the widow was .shown there as the owner of the estate in his place and stead. The Court of Wards relinquished charge of the estate sometime in November, 1925. The widow executed on the 16th August, 1927, a deed of gift conveying the bulk of the estate to her daughter and the son of the predeceased daughter. She also executed another deed of gift in the same year conveying the rest of the properties and on the 8th September, 1928, Ganga Bux Singh filed a suit in the Court of the Subordinate Judge of Sitapur for a declaration that under the aforesaid will she had only a life interest in the property and the transfers made by her were void. This suit was contested by her and one of the defences taken was that Ganga Bux Singh could not maintain the suit without first obtaining letters of administration with the will annexed. This defence was upheld and the suit was dismissed on the 14th July, 1930. Ganga Bux Singh having died in the meanwhile on the 19th October, 1929, his sons applied for letters of administration with the will annexed on the 25th September, 1930, on the original side of the Chief Court of Oudh. This application was opposed by the 918 widow and other heirs of Shankar Bux Singh inter alia on the ground that the will had been executed without the sanction of the Court of Wards. Mr. Justice Kisch delivered an elaborate judgment, negatived all the objections and granted letters of administration with the will annexed to the sons of Ganga Bux Singh on the 16th November, 1931. An appeal filed by the widow and heirs of Shankar Bux Singh against that decision was allowed by the Bench of the Chief Court of Oudh at Lucknow on the 8th September, 1933, and the orders passed by the lower court granting letters of administration with the will annexed were set aside. The sons of Ganga Bux Singh took an appeal to the Privy Council and their Lordships of the Privy Council on the 7th May, 1937, reversed the decree of the Appeal Court and restored the decree passed by Mr. Justice Kisch. Their Lordships however observed that the only effect of their decision was that letters of administration with a copy of the will annexed must be granted as prayed but that would not in any way prejudice any proceedings against any of the beneficiaries which may be open to the respondents or any of them. On the 9th September, 1937, the widow, the daughter and the son of the predeceased daughter of Shankar Bux Singh, the plaintiffs, 'filed the suit out of which this appeal arises, against the three sons of Ganga Bux Singh, the defendants, for a declaration that the will dated the 28th July, 1904, was inoperative and ineffectual and that in any case the defendants had no right, title or interest in the properties in suit, that plaintiff I was entitled to hold the property in suit under the will of Shankar Bux Singh dated 19th June, 1901, or that the plaintiffs 1 to 3 were entitled to the same as heirs at law of Shankar Bux Singh deceased under the provisions of the Indian Succession Act, and for further and other reliefs. In the plaint they alleged that the will was inoperative as Shankar Bux Singh had no animus testandi and that it was void and inoperative in respect of the testamentary disposition in favour of Ganga 919 Bux Singh and his sons because Ganga Bux Singh failed to perform his part of the contract as regards the payment of monthly allowance and the defendants therefore could not take advantage of or claim any benefit tinder that testamentary disposition and further the payment of the said allowance being a condition precedent and the condition not having been fulfilled the disposition became inoperative. The defendant 3 filed a written statement on the 7th February, 1938, contesting the plaintiff 's claim. He contended that the plea as to the validity or effect of the will was barred by resjudicata by virtue of the judgment of the Privy Council dated 7th May, 1937. He denied that the will was executed in consideration of the agreement. He also denied that there was any contingent or conditional contract or any trace of the alleged condition in the whole of the correspondence between Shankar Bux Singh and the Board of Revenue. The learned Civil Judge, Sitapur, after considering the evidence, oral as well as documentary, led before him held that the will as well as the agreement formed one contract, that Ganga Bux Singh had failed to perform his promise or his part of the contract, that the only point which was agitated before their Lordships of the Privy Council was as regards the consent of the Court of Wards and that therefore even though the plaintiffs were precluded from disputing the genuineness of the will they were not precluded from seeking a declaration to the effect that the defendants were not entitled to any benefit under the will, and that the decision therefore did not operate as res judicata so far as issues in the present case were concerned. He however held that the contract clearly provided a remedy for breach on the part of either party, that Shankar Bux Singh did not in fact cancel the will and could not be said to have treated it as inoperative, that Ganga Bux Singh acquired a vested interest in the estate on the death of the testator and that on his death that interest devolved on his sons amongst whom were the defendants in the suit and that the plaintiffs were, not entitled to any relief as claimed, The 920 plaintiffs filed an appeal to the Chief Court of Oudh. The Chief Court of Oudh negatived the contention that Shankar Bux Singh had no animus testandi and that it was a will in form only and not in substance, holding that it was barred by res judicata by reason of the decision of their Lordships of the Privy Council. It also negatived the contention that the bequest in favour of Ganga Bux Singh was a conditional bequest or that Ganga Bux Singh having failed to fulfil his obligation to pay the gujara his original character as a legatee changed into that of a trustee and he must hold the beneficial interest for the testator or his heirs. The appeal was therefore dismissed with costs. The plaintiffs applied for leave to appeal to the Privy Council and the necessary certificate was granted by the Chief Court of Oudh on the 8th August, 1947. It is necessary at the outset to set out the deed of agreement and the will executed by Ganga Bux Singh and Shankar Bux Singh respectively on dates the 7th January, 1904, and the 28th July, 1904. The deed of agreement dated the 7th January, 1904, ran as under: "Whereas, my cousin Thakur Shankar Bakhsh Singh, Taluqdar of Rampur Kalan, has proposed to make a bequest of his taluka, immovables, movables, rights etc. in favour of his wife and, after her death in my favour and that of my sons Dwarka Nath Singh, Ajodhya Nath Singh and Tirbhuwan Nath Singh, there fore by way of consideration for this concession and favour, I, the executant, out of my own free will do hereby execute this agreement in favour of my cousin aforesaid that in the month in which the said cousin might execute the said will in my favour and that of my sons and lays the same along with an application before the Deputy Commissioner, Sitapur district, for sanction of the Members of the Board of Revenue, I shall from the 1st date of the month following that month, continue to pay to my said cousin Rs. 50 in cash every month during his life, so long as the said will remains in force and under this contract I make my person liable and hypothecate the same by virtue 921 of this agreement. If I, the executant, fail to perform the said contract the said cousin has power to have the same performed by me, the executant, through Court. If the will mentioned above executed by the said cousin, be not sanctioned by the Members of the Board of Revenue or if under any circumstance, the kV said cousin may himself revoke the said will, then from the time of revocation or refusal by the Board of Revenue the said cousin shall not be entitled to receive the aforesaid monthly amount of Rs. 50 and whatever money the said cousin might have received from me, the executant, up to the said refusal or revocation the said cousin shall necessarily be bound to refund that money to me, the executant. " The will dated the 28th July, 1904, was executed by Shankar Bux Singh in the terms following: " I am Thakur Shankar Baksh alias section John son of Thakur Anant Singh, Taluqdar of Rampur and Grantee of Piprawan, district Sitapur. Out of my own free will, inclination and accord and consent I make a will that after my death my wife for her lifetime shall remain in possession of my entire Ilaqa (estate) as well as the movable and immovable property, left by me, together with the rights etc., relating to the said properties, without the power of any sort to transfer the said properties and rights, that on the death of the said wife all the aforesaid property and the rights shall devolve on my real cousin, Ganga Bakhsh with all the proprietary powers, and that on the death of Ganga Bakhsh the said entire property and the rights shall devolve on Dwaraka Nath, Ajodhia Nath and Tirbhuwan Nath, sons of Ganga Bakhsh, like Ganga Bakhsh himself, in the following shares: Dwaraka Nath annas 6, Ajodhia Nath aninas 5, Tirbhuwan Nath annas 5: and that the persons mentioned below shall continue to get the maintenance allowance (Guzara) according to the amounts and conditions noted below: Musammat Permeshuri, my eldest daughter, married at Allahabad to the son of Rai Anant Ram, generation 922 after generation, (limited) to male issue, Rs. 100 per month; Musammat Chandrani, my younger sister, married to Rai Raghubir Bakhsh, son of Rai Kunwar Bahadur, Rais of Shahabad, district Hardoi, generation after generation (limited) to male issue, Rs. 60 per month; Mussamat Roop Rani, my real paternal aunt (father 's sister), wife of Munshi Chedi Prasad deceased, Rais of Qasba Mahona, district Lucknow, generation after generation, (limited) to male issue, Rs. 45 per month; Musammat Sohni, my mother for her life, Rs. 70 per month. * * * * * Be it also known that my estate (Ilaqa) is under the Superintendence of the Court of Wards and the Hon 'ble Members of the Board of Revenue have granted me power to execute the will so I do hereby execute this my last will cancelling all the previous wills executed by me ' " It is clear from the terms of the deed of agreement that Ganga Bux Singh agreed to pay Rs. 50 in cash every month during the lifetime of Shankar Bux Singh in consideration of Shankar Bux Singh having proposed to make a bequest of the remainder in favour of Ganga Bux Singh and his sons and that it was after the deed of agreement was got registered by Ganga Bux Singh on the 11 th January, 1904, that the draft of the will was submitted on the 18th January by Shankar Bux Singh to the Court of Wards. It was this draft of the will amended as it was by the letter dated 27th April, 1904, that was engrossed in the will which was ultimately executed on the 28th July, 1904, after the letter of sanction obtained from the Board on 25th May, 1904. The learned Civil Judge under the circumstances came rightly to the conclusion that the deed of agreement and the will formed part of the same transaction, that the consideration for the will was the deed of agreement and the consideration for the agreement was the will and that the will 923 as well as the agreement formed one contract. This finding was not challenged before the Chief Court of Oudh and could not be challenged before us. There was also a further finding of fact which was recorded by the learned Civil Judge and it was that Ganga Bux Singh failed and neglected to make any payment to Shankar Bux Singh in terms of the deed of agreement even though Shankar Bux Singh executed the will and laid the same along with the application before the Deputy Commissioner, Sitapur, for sanction of the Members of the Board of Revenue and that Ganga Bux Singh thus failed to perform his part of the contract. This finding also was not challenged before the Chief Court of Oudh and could not be challenged before us. The question therefore which falls to be considered by us is what is the effect of the failure on the part of Ganga Bux Singh to make the payments to Shankar Bux Singh in terms of the deed of agreement. It was urged by Dr. Tekchand, who appeared for the plaintiffs before us that by reason of such non payment and the breach of contract on the part of Ganga Bux Singh the will became ineffective and inoperative, that the payment of Rs. 50 per month during the lifetime of Shankar Bux Singh was a condition precedent to the vesting of the legacy in favour of Ganga Bux Singh and that condition not having been fulfilled the legacy did not vest in Ganga Bux Singh and that on a true construction of the terms of the will Ganga Bux Singh acquired no vested interest in the remainder. He also urged that the scope of the Privy Council judgment was misunderstood by the Chief Court of Oudh and that both the questions as regards animus testandi and the payment of Rs. 50 per month being a condition precedent though they were barred by res judicata in regard to the due execution of the will were still open to him as affecting the right of Ganga Bux Singh to the legacy which was provided for him by Shankar Bux Singh under the will. In regard to the last contention urged by Dr. Tekchand both the courts below were of the opinion that the question of animus testandi was barred by res 924 judicata. It was held by their Lordships of the Privy Council that the will in dispute was not revoked and that it was the last will and testament of Shankar Bux Singh. That decision necessarily meant that the testator when he appended his signature to the will was in a sound and disposing state of mind, was a free agent and 'duly executed the will in accordance with the law. The decision was conclusive as regards the testamentary capacity, due execution and the representative title of the person to whom the letters of administration with the will annexed were granted. It was not open therefore to the plaintiffs to contend that the will which was executed by Shankar Bux Singh was a will merely in form and not in substance. The question of animus testandi was therefore barred by res judicata. In regard however to the question whether the bequest in favour of Ganga Bux Singh could take effect by reason of default in payment the decision of the Privy Council did not constitute res judicata and it was open to the plaintiffs to urge that contention. Both the courts ' below therefore allowed the plaintiffs to agitate that ques tion though they came to a conclusion adverse to the plaintiffs. We are of the opinion that there was no bar of res judicata and the courts below were right in allowing the plaintiffs to agitate that question. The payment of Rs. 50 per month to Shankar Bux Singh during his lifetime might be a condition precedent to the whole will coming into operation or might, be a condition precedent to the vesting of the legacy in favour of Ganga Bux Singh. If the plaintiffs urged the former position that plea would certainly be barred by res judicata. No court would grant a probate or letters of administration with the will annexed in regard to a will which has ceased to be operative and was a mere scrap of paper. The plaintiffs could not therefore be heard to say that 'by reason of the non fulfilment of the condition precedent the whole will had become inoperative, for that would run counter to the decision of the Privy Council. Even on merits such a position would be untenable for the simple reason that besides 925 Ganga Bux Singh there was the widow, who was given a life interest and there were the three daughters, the father 's sister and the mother who were given legacies by way of maintenance and they were certainly not guilty of non fulfilment of any condition precedent. The will would certainly therefore stand so far as they were concerned and the whole effect of the non fulfilment of the condition precedent qua Ganga Bux Singh would be to prevent the vesting of the legacy in his favour. The latter position therefore would be available to the plaintiffs and they could contend that by reason of the non fulfilment of the condition precedent by Ganga Bux Singh the legacy provided in his favour did not vest in him. If the payment of Rs. 50 per month therefore constituted a condition precedent the plaintiffs were on firm ground and that position could not and was not contested before us by the learned counsel appearing for the defendants. It therefore remains to be considered whether the payment of Rs. 50 pet month to Shankar Bux Singh during his lifetime constituted a condition precedent to the vesting of the legacy in favour of Ganga Bux Singh. There is no doubt, as held by the learned Civil Judge, that the consideration for the will was the deed of agreement and the consideration for the agreement was the will and that the will as well as the agreement formed one contract. But for Ganga Bux Singh having executed the deed of agreement Shankar Bux Singh would not have forwarded the draft will to the Court of Wards for its sanction and he would also not have executed the will on the 28th July, 1904. The contract was an overall contract under which both the parties had to perform their respective obligations. The obligation on the part of Ganga Bux Sigh was to execute the deed of agreement, agreeing to pay the moneys to Shankar Bux Singh in accordance with the terms thereof. The obligation on the part of Shankar Bux Singh was to execute the will and submit it to the Court of Wards for its sanction. Both these obligations were fulfilled by the parties and the two documents were supported by consideration and became binding 926 on both the parties. The nonperformance of the agreement to pay by Ganga Bux Singh constituted at best a failure. to fulfil his obligation and Shankar Bux Singh became entitled to pursue his rights and remedies against Ganga Bux Singh by reason of the breach of contract by him. It was urged by Dr. Tekchand that the consideration here constituted a condition precedent and that the non payment of Rs. 50 per month by Ganga Bux Singh constituted non fulfilment of condition precedent. He relied upon the observations of Chief Justice Wills in Acherley vs Vernon, 125 English Reports 1106 at page 1108 (Willes 153 at page 156): " I know of no words that either in a will or deed necessarily make a condition precedent, but the same words will either make a condition precedent or subsequent according to the nature of the thing and the intent of the parties. If therefore a man devise one thing in lieu and consideration of another, or agree to do anything or pay a sum of money in consideration of anything to be done, in these cases that which is the consideration is looked upon as a condition precedent. So is the case of Peters vs Opie, I Ventr. 177, and I Saund. If a man agree to pay a sum of money to another pro labore suo in pulling down a house, the pulling down of the house is a condition precedent. So is the case of Thorpe and Thorpe. I Salk. 171, where a man agreed to pay a sum of money to another he releasing the equity of redemption in certain lands. And so is the case of Turner vs Goodwin, adjudged by Lord Macclesfield and the rest of the Judges of B. R. upon great consideration, P. 13 Anne, in which case Goodwin was to pay Turner 15001. be assigning a judgment. In all which cases it was holden that the party who was to receive the money was not entitled to demand it until he had performed that which was the consideration of the payment, and which was considered in all these cases to be in the nature of a condition prece dent. * * * * 927 So likewise if it plainly appear to be the intent of the testator that the devise shall not have the benefit of the devise unless he perform a certain act enjoined him by the devisor, this is a condition precedent; and the devisee shall have no benefit of the devise until he perform it, even though the condition be never so unreasonable if it be not illegal or impossible; for cujus est dare ejus est disponere. " These observations were particularly relied upon by Dr. Tekehand in support of his contention that the payment of Rs. 50 per month to Shankar Bux Singh during his lifetime constituted a condition precedent to the vesting of the legacy in favour of Ganga Bux Singh. While recognising the force of these observations we are constrained to observe that the terms of the deed of agreement negative any such contention. The agreement itself provided what was to happen if payment was not made in accordance with the terms thereof. If Ganga Bux Singh failed to perform the contract Shankar Bux Singh was to have the power to have the same performed by Ganga Bux Singh through Court. This consequence could not be contemplated if the payment constituted a condition precedent and the non fulfilment of the condition precedent was to have the effect of rendering the agreement inoperative. In that event the agreement itself would become inoperative and no rights under the agreement would survive to Shankar Bux Singh. The right which was therefore given to Shankar Bux Singh to have the agreement performed by Ganga Bux Singh contemplated the existence and the continued existence of the agreement so as to enable Shankar Bux Singh to hold Ganga Bux Singh to its performance, The continued existence of the contract was in contemplation of the parties and so far as Ganga Bux Singh is concerned it was at no stage contemplated that he could forego the performance of the obligation on his part to pay Rs. 50 per month to Shankar Bux Singh during his lifetime so long as the will stood unrevoked. 928 It is significant to observe on the other hand that two events were contemplated so far as Shankar Bux Singh himself was concerned. The one was the withholding of the consent of the Court of Wards and the other was the revocation of the will by Shankar Bux Singh himself. The sum of Rs. 50 per month was agreed to be paid by Ganga Bux Singh to him from the month when Shankar Bux Singh executed the will and laid it before the Court of Wards for its sanction. The Court of Wards might withhold its consent to the will and in that event whatever payments were made during the interval by Ganga Bux Singh to Shankar Bux Singh had to be refunded by the latter. Even though the Court of Wards might sanction the will Shankar Bux Singh might later on revoke the will and the consequence of such revocation was also provided in that Shankar Bux Singh was to refund to Ganga Bux Singh the amounts which he had paid up to the time of revocation to Shankar Bux Singh in accordance with the terms of the agreement. It has to be observed moreover that all these constituted independent obligations on the part of both the parties. The obligation on the part of Ganga Bux Singh was so long as the will stood unrevoked to pay to Shankar Bux Singh Rs. 50 per month during his lifetime and the obligation on the part of Shankar Bux Singh was to obtain the consent of the Court of Wards and to leave the will unrevoked during his lifetime. These obligations were independent of each other and the consequences of the non performance of these obligations on the part of each of the parties were expressly provided in the agreement itself. It could not therefore be contended that the payment of Rs. 50 per month to Shankar Bux Singh during his lifetime constituted a condition precedent to the vesting of the legacy in his favour. That was merely a consideration provided by Ganga Bux Singh for the execution of the will by Shankar Bux Singh in his favour and if Ganga Bux Singh committed a breach of the agreement the only result was that Shankar Bux Singh would become entitled to recover the amount due on such default 929 from Ganga Bux Singh by having recourse to a court of law. The contract would continue to subsist, the parties being relegated to their rights and remedies thereunder as contemplated by the parties. In spite of the non payment by Ganga Bux Singh of the sum of Rs. 50 per month to Shankar Bux Singh in accordance with the terms of the agreement at no time did Shankar Bux Singh revoke the will nor did he pursue Ganga Bux Singh in a court of law for the recovery of the amounts in respect of which Ganga Bux Singh was in default. He left the will unrevoked and on his death the will became effective as his last will and testament and operated to vest in Ganga Bux Singh ail interest in the remainder as therein provided. There is nothing in the will itself which in terms makes the bequest conditional on regular payment of the amount under the agreement. The argument which was advanced by Dr. Tekchand based on section 81 of the Indian Trusts Act could not avail him for the simple reason that the intention of Shankar Bux Singh had to be gathered as on the date of the execution of the will and not at any subsequent time thereafter. That intention was clearly to effect a testamentary disposition of the remainder in favour of Ganga Bux Singh. It was certainly farthest from the thought of Shankar Bux Singh not to dispose of the beneficial interest in the remainder in favour of Ganga Bux Singh with the result that there could neither be a secret trust nor a trust of imperfect obligation created in favour of the heirs at law of the testator Shankar Bux Singh. The argument of Dr. Tekchand that the remainder did not vest in Ganga Bux Singh but fell into residue by reason of his having predeceased the widow of Shankar Bux Singh is equally of no avail. The legacy in favour of Ganga Bux Singh was a legacy of the remainder of the estate which vested in Ganga Bux Singh but was deferred in possession till after the extinction of the life interest created in favour of the plaintiff 1. Such vested interest could devolve upon the defendants, the heirs and legal representatives of 120 930 Ganga Bux Singh on the death of the latter and the defendants were therefore as the heirs and legal repre sentatives of Ganga Bux Singh since deceased rightly entitled to the same. As the bequest was not conditional and did not lapse there could be no question of any resulting trust or of any intestacy with respect to the remainder. The result therefore is that the appeal fails and must be dismissed with costs. Appeal dismissed. Agent for the appellants : Rajinder Narain.

On the 7th January, 1904, G, a cousin of S, executed an agreement in favour of S, the material portion of which ran as follow&: "Whereas my cousin S has proposed to make a request of his taluka in favour of his wife and after her death in my favour and 118 914 that of my sons therefore by way of consideration for this concession and favour, I, the executant, out of my own free will do hereby execute this agreement in favour of my cousin aforesaid that in the month in which the said cousin may execute the said will in my favour and that of my sons and lays the same along with an application before the Deputy Commissioner, Sitapur district, for sanction of the Members of the Board of Revenue, I shall from the 1st date of the month following that month continue to pay the said cousin the sum of Rs. 50 in cash every month during his life so long as the said will remains in force If I fail to perform the said contract the said cousin has power to have the same performed by me through the Court. " This agreement was registered on the 11th January. On the 18th January, S submitted a draft will for sanction and the will as amended and sanctioned was executed on the 28th July, 1904. This will provided as follows: "after my death my wife for her lifetime shall remain in possession of my entire estate without the power of any sort to transfer the said properties and rights, that on the death of the said wife all the aforesaid property and rights shall devolve on my cousin G with all proprietary powers and that on the death of G, the said entire property and rights shall devolve on X, Y, Z, sons of G, in the following shares . " The will also provided for maintenance for the daughter, sister, aunt and mother of section On the application of G 's sons (G having died) letters of administration with the will annexed were granted to them by the Chief Court of Oudh and this decision was affirmed by the Privy Council on appeal in 1937. The heirs of S thereupon instituted a suit against the sons of G for a declaration that the will was inoperative and ineffectual and that G 's sons had in any case no right to the properties of S, as S had no animus testandi and G had also failed to pay Rs. 50 to S as agreed: Held, (i) that the deed of agreement and the will formed parts of one transaction and formed one contract, consideration for the will being the agreement, and consideration for the agreement being the will; (ii) as the Privy Council had decided that the will was the last will and testament of S and granted letters of administration, the question of animus testandi was res judicata ; (iii) with regard to the plea that the monthly payment of Rs. 50 was a condition precedent to the validity of the will and that by reason of the non fulfilment of this condition the will had become inoperative, such a plea was also barred by res judicata as the Privy Council bad granted letters of administration; and even on the merits the plea was untenable as the wife and other relations of the testator had also certain rights under the will which did not depend on the monthly payment by G; (iv) the question whether the payment of Rs. 50 was a con dition precedent to the vesting of the legacy in G or G 'B sons was 915 not, however, res judicata and it was open to the plaintiff to raise such a plea; (v) on a proper interpretation of the terms of the agreement, the payment of Rs. 50 per month was not a condition precedent to the vesting of the legacy in G, but merely a consideration, and the plaintiffs ' remedy was to enforce the agreement if it was not duly performed; (vi) that as G obtained a vested remainder under the will, his interest did not fall into the residue on his death before the widow, but vested in his sons; and as the bequest to G did not lapse there was no question of any resulting trust or of any intestacy with respect to the remainder, and G 's sons were entitled to the estate under the will.

Civil Appeal No. 285 of 1958. Appeal from the judgment and decree dated September 22, 1955, of the former Nagpur High Court in Mis. (First) Appeal No. 201 of 1952. N. C. Chatterjee, D. R. Baxy and Dharam Bhusan, for the appellant. B. section Sastri and Ganpat Rai, for the respondent. October 16. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. This appeal, on certificate granted by the High Court at Nagpur, is directed against its order dismissing the appellant 's appeal against the dismissal of his objection, under section 47 of the Code of Civil Procedure, by the III Civil Judge, Class I, Nagpur. The respondent purchased at auction sale, held by the Revenue Officer for recovery of arrears of land revenue, eight anna share of Ganpatrao in mouza Vadoda, Tehsil and District Nagpur, in the Central Provinces, and obtained formal possession of that share on September 23, 1938. Ganpatrao relinquished his share in khudkahst lands they were recorded as the occupancy land of his wife and sons. They surrendered those fields to lambardar Narain, who leased those fields in occupancy right to tho appellant in 1940. The respondent filed a suit for possession of certain fields including the fields in suits viz., fields khasra Nos. 147 and 154, 126 and based his claim on his proprietary right to recover possession and not on the loss of possession on account of the appellant 's dispossessing him. The suit was decreed and the decree was upheld by he Nagpur High Court by its order dated April 20, 1951, it being held that the respondent was entitled to the fields in suit which were originally khudkasht fields as part and parcel of the eight anna share of Mahal No. 2 purchased by the respondent. It so happened that between the closing of the arguments in the appeal before the High Court, some time before March 31, 1951, and the delivery of judgment on April 20, 1951, the Madhya Pradesh Abolition of proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950 (M.P. Act No. 1 of 1951), hereinafter called the Act, came into force. This fact does not appear to have been brought to the notice of the High Court as it did not consider the effect of the Act on the appeal before it. The respondent decree holder filed execution application for the recovery of costs and delivery of possession on July 23, 1951. The appellant paid up the costs, but, on August 31, 1951, filed an objection to the application for delivery of possession on the ground that the respondent decree holder had no right to dispossess the appellant judgment debtor, as the respondent had lost his proprietary rights to the fields and the appellant had acquired rights to occupy them subsequent to the confirmation of decree for possession by the High Court. It was stated that the malguzari proprietary rights of the respondent decree holder, except his rights over home farm fields, ceased to exist on March 31, 1951, by virtue of section 3 of the Act and vested in the State thereafter. Home farm fields were those fields which were recorded as khudkasht or sir fields in the Jamabandhi of 1948 49. The fields in suit were not so recorded and were recorded as occupancy fields of appellant,. 127 It was further contended that the State had, after the date of vesting, collected rent from the appellant recognizing the land in suit to be the tenancy land of the appellant. On September 24, 1951, the appellant filed an application stating further facts in support of his objection. He stated that the respondent neither claimed, in the ex propriation proceedings before the Compensation Officer, Nagpur, the fields in suit as his khudkasht lands, nor raised any such claim in proceedings for fixation of assessment on his home farm and that the decree holder had not been declared malik makbuza of the land in suit. He further stated that the respondent had included the rent of the fields in suit in the area of the village for the purpose of claiming compensation and thereby got more compensation on that account and that the fields in suit had been declared malik makbuza of the appellant on July 22, 1952, under section 41 of the Act. The respondent contended before the Executing Court that the appellant could not raise such objections in the Executing Court and should have raised them in the High Court before it had passed the orders in the appeal. He further contended that he had not lost his right to possess the fields in suit and that his claim to possession of the fields was not affected by the Act the provisions of which did not apply to the facts of the case. He also contended the State had absolutely no right to collect any rent for the fields from the appellant and any collection made did not affect the respondent 's rights. He further contended that the appellant could not take any advantage of his omission to claim the land in suit as his home farm as he could not have moved in the matter without obtaining possession or of a declaration of malik makhbuza under section 41 of the Act during the pendency of the execution application as he had fraudulently suppressed the fact that he had been hold by the 128 High Court not to have been an occupancy tenant of the land in suit and that the respondent had a decree for possession against him. The State of Madhya Pradesh was served with notice of the objection and filed its statement of facts stating therein that the plots in suit were not shown as home farm by the ex proprietor respondent, that no Jamabhandhis as required by section 2(g) of the Act, were filed in the compensation proceedings and that, consequently, the respondent was not declared mailk makbuza of those plots. It was also stated that the appellant had been declared malik makbuza of the plots under section 41/56 of the Act on application under section 4(2) of the Madhya Pradesh Agricultural Raiyats and Tenants Acquisition of Privileges) Act, 1950 (M. P. Act XVIII of 1950), and that he has paid land revenue to the State. The Execution Court dismissed the objection. It held that the vesting of respondents proprietary rights in the State did not come in his way to take possession of the fields ill execution of the decree, as the Deputy Commissioner could not take possession of the fields in suit under section 7 of the Act as they were occupied lands. It further held that the land in suit did not form the respondent 's home field that the respondent could not be the malik makbuza of the fields under section 38 (1) of the Act as the fields were not in his possession. It further held that the declaration of the appellant, who was a trespasser as a malik makbuza, was illegal. The appellant then went in appeal to the High Court. The High Court relied on the case reported as Rahmatulla Khan vs Mahabirsingh (1) in which it was held that the definition of a 'home farm ' in section 2, clause (g), of the Act, should be liberally construed and should include the fields of a proprietor who was entitled to get the Revenue papers of 1948 49 corrected as a result of the decree in his favour, (1) I.L.R. 129 even though the fields were not recorded as his khudkasht in the 1948 49 papers, because it was the duty of the Revenue Authorities to make correct entries in the Jamabandis and other village papers. The High Court, however, pointed out that the decision in Rahmatullah 's Case(1) made out an exception in the definition which is not in it and in effect laid down that the application of the Act depended upon the result of pending litigation, a view which was not accepted in the earlier Full Bench case of Chhote Khan vs Mohammad Obedullakhan (2). The learned Judges further said: Though we do not agree with the view of Mudholkar, J., the decision ranks as a Division Bench Case and we follow it, though reluctantly. " The learned counsel for the appellant has urged that the respondent is not entitled to execute the decree for possession as he had lost the proprietory right which entitled him to get possession. It is further urged that the appellant has secured the rights of malik makbuza of the land subsequent to the decree and has thus got a right to remain in possession in spite of the decree. The learned counsel for the respondent mainly relies on the contention that the Execution Court cannot go behind the decree and therefore must execute it and deliver possession to the respondent. Before considering the question arising for determination in this appeal, it will be convenient to detail the relevant provisions of the Act and their effect. The preamble of the Act says that it is expedient to provide for the acquisition of the rights of the proprietors in estates, mahals, alienated villages and alienated lands in Madhya Pradesh and to make provision for other matters connected therewith. This indicates that the Act purported to deal with the rights of the proprietors and not directly with the rights of other persons in the (1) I.L.R. (2) I.L.R 130 estates, mahals, alienated villages and alienated lands. The proprietors were intermediaries between the persons actually cultivating the land and the Government. They realised rent from the former and paid revenue to the latter. Section 3 is the vesting section and its sub sections (1) and(2) read: (1) Save as otherwise provided in this Act, on and from a date to be specified by a notification by the State Government in this behalf, all proprietary rights in an estate, mahal, alienated village or alienated land, as the case may be, in the area specified in the notification, vesting in a proprietor of such estate, mahal, alienated village, alienated land, or in a person having interest in such proprietary right through the proprietor, shall pass from such proprietor or such other person to and vest in the estate for the purposes of the State free of all encumbrances. (2) After the issue of a notification under subsection (1), no right shall be acquired in or over the land to which the said notification relates, except by succession or under a grant or contract in writing made or entered into by or on behalf of the State; and no fresh clearings for cultivation or for any other purpose shall be made in such land except in accordance with such rules as may be made by the State Government in this behalf. " In accordance with the provisions of this section, the proprietary rights in an estate, mahal, alienated village or alienated land in the area specified in the notification vesting in a proprietor of such estate etc., were to pass from such proprietor and vest in the State for purposes of the State free from all encumbrances. These provisions themselves were sufficient to divest the proprietor of such estate etc., of his proprietary right. The consequences of such 131 vesting are further specified in section 4. In view of sub section (2) of section 3, no right could acquired over the land which had vested in the State except by succession or under a grant or contract in writing made or entered into by or on behalf of the State. This means that no person could acquire any right over such land under a decree passed in his favour subsequent to the vesting of the estate on the notified date and that therefore the respondent did not acquire the right to possess this land under the decree in his favour. The relevant portions of sub section (1) of section 4 are: (1) When the notification under section 3 in respect of any area has been published in the Gazette, then, notwithstanding anything contained in any contract, grant or document or any other law for the time being in force and save as otherwise provided in this Act, the consequence as hereinafter set forth shall, from the beginning of the date specified in such notification (hereinafter referred to as the date of vesting), ensue, namely (a) all rights, title and interest vesting in the proprietor in such area including land (cultivable or barren), shall cease and be vested in the State for purposes of the State free of all encumbrances. . . . . . . . . . . . . . (e) the interest of the proprietor so acquired shall not be liable to attachment or sale in execution of any decree or other process of any court, civil or revenue, and any attachment existing at the date of vesting or any order for attachment passed before such date shall, subject to the provisions of section 73 of the , case to be in force." ' sub sections (2) and (3) of section 4 are as follows: (2) Notwithstanding anything contained in sub section (1), the proprietor shall continue 132 to retain the possession of his homestead, home farm land, and in the Central Provinces also of land brought under cultivation by him after the agricultural year 1948 49 but before . the date of vesting. (3) Nothing contained in subsection (1) shall operate as a bar to the recovery by the outgoing proprietor of any sum which becomes due to him before the date of vesting by virtue of his proprietary rights and any such sum shall be recoverable by him by any process of law which but for this Act would be available to him. " It is to be noted that the consequences mentioned in 8. 4 follow the notification under 8. 3, notwithstanding anything contained in any contract, grant or document or in any other law for the time being in force. The question is whether the word 'document ' includes a decree of the Court. We do not see any good reason why a decree of the Court, when it affects the proprietary rights and is in relation to them, should not be included in this expression. The main object of sections 3 and 4 and in fact, of the Act itself, is that all the bundle of rights which a proprietor possess on account of his proprietorship of the land within the estate etc., should cease, except such rights which are saved to the proprietor under some specific provision of the Act. Any rights which accrue to the proprietor under a decree by virtue to his proprietary right will not, under the scheme of the Act, prevail over the statutory consequences following the vesting of the proprietary rights in the State and will be lost to the proprietor. One such right is the right of the proprietor under a decree to obtain possession over certain land. Such a decree for recovery of possession is the result of the recognition of the proprietor 's right of possession as proprietor over that land as against the claim of the judgment debtor to 133 retain possession of that land. The proprietary right vests in the State and as a consequence of it the proprietor 's right under the decree to obtain possession also vests in the State, even though tho State gets right to the possession of the land under other provisions of the Act as well. Section 7 empowers the Deputy Commissioner to take charge, on the date of vesting, of all lands other than occupied lands and homestead of all interest vesting in the State under B. 3. This means that the Deputy Commissioner could take possession of the land in suit on the date of vesting, i. e., on March 31, 1951, as it was neither the proprietor 's home farm nor occupied land, as defined in cl. (k) of c. 2, of the appellant who was held by the High Court to be a trespasser vide judgment of the High Court dated April 20, 1951, now reported in Subhan vs Madhorao (1). `Occupied land ' means, in relation to the Central Provinces, according to sub cl. (1), land held immediately before the date of vesting in absolute occupancy or village service tenure, or land held as malik makbuza, or land comprised in a home farm. Occupied land did not include land held by a person as a trespasser. The provisions of cl. (e) of sub section (1) of section 4 indicate that certain decrees against the interest of the proprietor become inexecutable on the vesting of his rights in the State. There is therefore good reason to hold that decrees in his favour also become inexecutable if they are based on his proprietary right which he possess no more and which has vested in the State. The Act provided, by sub section (3) of section 4, that the out going proprietor was free to recover any sum which had become due to him before the date of vesting by virtue of his proprietary rights by any process of law which, but for the Act, would be (1) I.L.R. 134 available to him. It does not provide for the outgoing proprietor to recover possession of land by any process of law if he had become entitled to the possession of that land before the date of vesting. The absence of any such provision adds strength to the view that the proprietor 's right to obtain possession of land under a decree in his favour gets lost to him after the date of vesting. Sub section (2) of section 4 of the Act provides that the proprietor can continue to retain possession of home farm land after the vesting of his proprietary right in the State. The respondent cannot take advantage of this provision even if the land in suit be held to be home farm. He was not in possession of the land in suit on the date of vesting and no question of continuing to retain possession arose. In fact, the fields in suit could not be his home farm and therefore he got no right to retain possession over them. Clause (g) of section 2 of the Act defines `home farm '. It reads. (g)`home farm ' means, (1) in relation to Central Provinces, (ii) land recorded as sir and khudkasht in the name of a proprietor in the annual papers for the year 1948 49, and (ii) land acquired by a proprietor by surrender from tenants after the year 1948 49 till the date of vesting; (2) in relation to merged territories, that part of the land under the personal cultivation of the proprietor on the date of vesting which was similarly under cultivation in the agricultural year 1949 50 and which he is omitted to retain on the termination of proprietary tenure under any instrument having the force of law and applicable to such tenure. Explanation. Land under personal cultivation includes land allowed to lie fallow in 135 accordance with the usual agricultural practice but does not include any land in lawful possession of a raiyat or tenant. . . . . . . . . . . It is significant to note in this completion that sub cl. (1) refers to land actually recorded as sir and khudkasht in the annual papers of 1948 49 and does not refer in terms to land which was the sir and khudkasht of the proprietor in that year and which ought to have been recorded as such in those papers but had not been so recorded. Another point to be noted is that though cl. (ii) refers to land acquired by the proprietor by surrender from tenants between the close of the year 1948 49 and the date of vesting no reference is made in this definition to land the possession of which had been obtained by the proprietor as a result of a decree during that period or to the possession of which the proprietor was held entitled under the decree of the Court passed before the date of vesting. It is also significant to notice that in sub section (2), the land answering the description of 'home farm ' is described differently. Only that land comes within the expression `home farm ' ' which had been under the personal cultivation of the proprietor on the date of vesting and which had been similarly under cultivation in the agricultural year 1949 50, and which he is entitled to retain even on the termination of his proprietary tenure under any instrument having the force of law and applicable to that tenure. Personal cultivation of the proprietor at two relevant dates was the main criterion. Such cultivation was not made the criterion in the definition in sub cl. (1) of sub section It is not necessary, according to that sub clause, that the proprietor be personally cultivating that land. The only condition requisite for the proprietor having certain land treated as his home farm was the fact that the annual papers of 1948 49 recorded that land as his sir and khudkasht. The basis was the record and 136 not the fact of actual cultivation or his title to that an land The definition evinces the intention of the Legislature to remove the question of certain land being `home farm ' or not from the sphere of litigation. Recorded entry was treated to be the basis for adjudging tho land to be `home farm. ' There is no ambiguity about the definition of 'home farm ' and so the question of strict or liberal construction does not arise. These consideration lead to the conclusion that land cannot come within the definition of `home farm ' which had not been actually recorded as sir and khudkasht in the name of the proprietor in the annual papers for the year 1948 49 or which had not been acquired by the proprietor by surrender from tenants after the years 1948 49 till the date of vesting. The plots in suit were neither actually recorded as the respondent 's sir and khudkasht in the 1948 49 annual papers nor had been acquired by him by surrender from tenants during the period mentioned in sub cl.(ii) of cl. (1) of the definition and so could not be the respondent 's home farm. The decree of the trial Court was passed on July 12, 1944. As that decree was under appeal in 1948 49, it would not be right to say that the Revenue Authorities were in error in not correcting the entries in the annual papers. They could Not have corrected them merely on the basis of the decree. Correction in the entries would have been made if there had been change of possession. No change of possession took place and therefore no entry could have been made in the annual papers of 1948 49 with respect to the plots in suit to be the khudkasht of the respondent. In fact, even if the respondent had taken possession over the land in suit by executing the decree passed by the trial Court, an entry of his holding that land as khudkasht could have been made only if he had brought 137 that land under his own personal cultivation and not if he had let out the land to some other person. This consideration, again, would go against the respondent even if a liberal interpretation was to be given to the definition of `home farm '. Section 12 requires that every proprietor should file a statement of claim in the specified form and verify that statement in accordance with order VI, rule 15, Code of Civil Procedure. The respondent filed his compensation statement, Document No. 1, on September 20, 1951, and mentioned in his claim the total gross rental of his proprietary share. This rental included the recorded rent of the land in suit. Section 83 provides that every entry in the record of rights, the annual papers and the register of proprietary mutations in the Central Provinces, shall, for purposes of assessment and payment of compensation be presumed to be correct. This means that for the purpose of settlement of the claim filed by the respondent under section 12, the entry of the appellant 's being an occupancy tenant in the annual papers had to be presumed to be correct and, as a consequence of such a presumption, the land in suit cannot be taken to be the respondent 's khudkasht in 1948 49, and this supports the construction we have placed on the definition of `home farm ' in section 2 (g). Sub section (1) of section 38 provides that every proprietor who is divested of his proprietary rights in an estate or mahal, shall, with effect from the date of vesting, be a malik makbuza of the home farm land in his possession. The respondent does not appear to have taken any steps to get himself recognized as a malik makbuza of the land in suit on the ground that it was, his home farm. In fact, he estates in his reply to the appellant 's objection that he could not have moved in the matter without obtaining possession. 138 Exhibit A 1, dated May 8, 1951, is the statement of fixation of assessment on the home farm of the respondent. It does not include the land in suit. Section 45 provides inter alia that any person who, immediately before the date of vesting, was in possession of any holding, as an occupancy tenant, shall be deemed to be a tenant of the State and shall hold the land in the same rights and subject to the same restrictions and liabilities as he was entitled or subject to, immediately before the date of vesting. Section 41 provides inter alia for occupancy tenants to be declared in the prescribed manner to be malik makbuza of the land comprised in their holding on payment of the amounts mentioned in the section. The appellant applied for such a declaration on July 22, 1952 and got the declaration i his favour on the basis of the entry in the village papers, though that entry of his being an occupancy tenant was wrong in view of the finding of the High Court. Exhibit A 4 is the declaration by the Naib Tehsildar, Nagpur, on July 22, 1952, under s.41 of the Act, that 'the appellant was malik makbuza in respect of the land in suit. Exhibit A 6 is the copy of the Jamabandhi for holding serial No. 121 of mauze Vadoda for the year 1948 49, showing the respondent to be the occupancy tenant of the land in suit. Section 46 provides that every person deemed or declared to be a malik makbuza under section 33 or section 33 and every other malik makbuza in a mahal, shall be entitled to any right which a tenant has under the village wajibul arz. The appellant therefore got entitled to such rights of a tenant. It is clear from the various provisions of the Act already discussed in relation to the facts of this case, that the respondent was not recorded 139 and could not have been recorded to have khudkhast in the land in suit in the papers of 1948 49 and therefore could not have claimed this land as his home farm. In fact, he did not claim so. He therefore lost his proprietary rights in this land and they got vested in the State; He therefore had no subsisting right to recover possession of the land in suit, in spite of; the decree in his favour passed on the basis of his being the proprietor of the land in suit, and the appellant being in wrongful possession of that land. On the other hand, the appellant continued in possession and has, on the basis of the entries in the village papers which had to be presumed correct for the purpose of assessment of compensation secured a declaration of his being malik makbuza of such land from an officer of the State in whom the land in suit now vests. His right to occupy the land under this right was not adjudicated by the High Court in the judgment leading to the decree ought to be executed. He can therefore object to the execution of the decree for the delivery of possession as the respondent has no subsisting right and as he has secured from the State a good right to possess it as malik makbuza, even though it be on the basis of a wrong entry in the village papers. The right to possession vests in the State and under section 7, the Deputy Commissioner formally takes possession of the land, which is not home farm or occupied land within the definition of these expressions in the Act. If the land in suit be treated to be the appellant 's occupancy tenancy, his right to remain in possession as occupancy tenant continues after the vesting of the land in suit, in the State. If the land in suit be not taken to be occupancy land of the appellant in view of the finding of the High Court, the Deputy Commissioner would be deemed to have taken possession of the land from the appellant and any subsequent 140 possession of the appellant would be deemed to be possession under the State. The contention that the Executing Court can not question the decree and has to execute it as it stands, is correct, but this principle has no operation in the facts of the present case. The objection of the appellant is not with respect to tho invalidity of the decree or with respect to the decree being wrong. His objection is based on the effect of the provisions of the Act which has deprived the respondent of his proprietary rights, including the right to recover possession over the land in suit and under whose provisions the appellant has obtained the right to remain in possession of it. In these circumstances, we are of opinion that the Executing Court can refuse to execute the decree holding that it has become inexecutable on account of the change in law and its effect. Chhote Khan 's Case (1) has net much bearing on the question under consideration in the present case, as it did not deal with the executability of the decree obtained by a proprietor against a trespasser subsequent to the coming into force of the Act. It dealt with the executability of decrees in favour of the proprietors and passed prior to the enforcement of the Act and held that they had become inexecutable as the effect of sections 3,4,5,7,50 and 60 of the Act was that the rights which were exercisable by the proprietor, lambardar and sadar lambardar by reason of holding that character could no longer be exercised by them and that, even though the cause of action for enforcing those rights arose before the Act came into force, they could not be continued by those persons after the Act came into force as they had ceased to hold that character. The fact in Rahmatullah 's Case (a) were as follows: The plaintiff sued for possession in respect of 9.18 acres khudkasht lands on the allegation that his predecessor. in interest, Khubiram, had purchased the defendant 's interest in the village (1) I.L.R. (2) I.L.R, (1955) 983. 141 including khudkasht lands at a revenue auction sale on April 29, 1936. It was contended that the defendant has no right to remain in possession of the khudkasht lands which along with the, proprietary interest, passed at the revenue sale The defendant contented the suit on the grounds that his khudkasht lands did not pass in the revenue sale, that he had continued all along in possession in respect of the same and had thus acquired the rights of occupancy tenancy which were confirmed in consolidation proceedings. The suit was decreed in its entirety by the trial Court but the 1st appellate Court confirmed the decree with respect to a portion of khudkasht land which was held to be included in the revenue sale. By the time the second appeal was heard in the High Court, the Act had come into force. It was contended on behalf of the defendant judgment debtor that the suit must fail in view of the provisions of the Act as interpreted in Chhote Khan 's Case (1). In view of the difference of opinion between the learned Judge who heard the second appeal, two questions were referred to a third Judge for opinion and one of the questions was: Does the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) 'Act, 1950 (No. 1 of 1951) bar a suit by an ex proprietor for recovery of khudkasht lands purchased by him before the Act came into force ?" Mudholkar, J., to whom the questions were referred said at p. 996: It is clear from the documents on record that Khubiram had obtained possession of the land in suit after he purchased it along with the village share. The land was thus khudkasht of Khubiram and accordingly it continued to be khudkasht of the respondent who is a successor in title of Khubiram. No doubt, this land, though the khudkasht of the 142 respondent, was wrongly recorded as occupancy land of the appellant. But an erroneous recording of a khudkasht land as an occupancy land would not in law alter the real character of that land. Thus, despite the wrong entry, the land must be regarded as having always been the khudkasht of the respondent. If this Court affirms the decree of the two Courts below, the effect of its decision would not be to alter the character of the land and convert a land which is not khudkasht into a khudkasht land. " Interpreting the definition of `home farm ' in the Act to include such land, which, though not recorded as khudkasht of the proprietor in the annual papers of 1948 49, ought to have been recorded as such, he held that the suit was not barred. This is not a correct view, for the reasons stated by us earlier. As we are of opinion that the land in suit could not be the `home farm ' of the respondent as it was not recorded as his khud kasht in the annual papers of 1948 49, the respondent 's proprietary right of this land was lost and got vested in the State on the coming into force of the Act. On the other hand, we have also held that the appellant obtained a declaration of malik makbuza in his favour from the State, and thus has secured a right to possess it. In these circumstances, the decree ought to be executed by the respondent has become inexecutable and therefore the order under appeal deserves to be set aside We accordingly allow the appeal and set aside the order of the Court below and Allow the objection of the appellant to the execution of the decree and dismiss the execution application filed by the respondent. In the circumstances of the case, we make no order as to costs. Appeal allowed.

The respondent purchased at a revenue auction sale eight anna share of and obtained formal possession of that share on September 23, 1938. relinquished his share in Khudkasht lands and they were recorded as the occupancy lands of his wife and sons. In 1940 the appellant got a lease of those fields. The respondent instituted a suit for possession of the lands against the appellant basing his claim on his proprietary right to recover possession, and obtained a decree on July 12, 1944. The trial court 's decree was confirmed on April 20, 1951, by the High Court which held that the respondent was entitled to the lands as they were originally Khudkasht fields as part and parcel of the eight anna share purchased by him. In the meantime on March 31, 1951, the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, had come into force but the High Court did not consider the effect of the Act on the appeal before it. Under section 3 of the Act the proprietory rights in an estate specified in the notification passed from the proprietor and became vested in the State free from all encumbrances, rand by section 4, after the issue of the notification under section 3 124 notwithstanding anything contained in any contract, grant or document or any other law for the time being in force, all rights, title and interest which a proprietor possessed on account of his proprietorship of the land within the estate became vested in the State, except, inter alia, His home farm land and occupied land. Under section 2(g) of the Act home farm lands were those which were recorded as Sir and Khudkasht in the name of a proprietor in the annual papers for the year 1948 49, but in the present case the lands in respect of which a decree had been passed in favour of the respondent, were not so recorded. On the other hand, the lands were declared Malik Makbuza of the appellant under section 41 of the Act. In the execution application for the recovery of possession filed by the respondent the appellant raised objections that the respondent was not entitled to execute the decree for possession as his proprietary rights except his home farm lands, ceased to exist on March 1, 1951, by virtue of sections 3 and 4 of the Act and became vested in the State thereafter, and that the State had, after the date of vesting recognized the lands in suit to be tenancy land of the appellant. The respondent 's plea was that The appellant was not entitled to raise such objections ill the executing court, that the executing court could not go behind the decree and, therefore, must execute it and deliver possession to the respondent. The executing court dismissed the objections raised by the appellant, and the High Court took the view, relying upon Rahmatullah Khan vs Mahabirsingh, I. L. R. , that the lands in suit must be treated as home farm as it was the duty of revenue authorities to make correct entries in the village papers. ^ Held, that: (1) the principle that the executing court cannot question the decree and has to execute the decree has no operation on the facts of the present case because the objection of the appellant was based not with respect to the invalidity of the decree but on the effect of the provisions of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, which deprive the respondent of his proprietary rights including the right to recover possession over the lands in suit; (2) the word "document" ill section 4(1) of the Act includes a decree of the court; (3) the lands in suit could not be the home farm of the respondent as they were not recorded as his khudkasht in the annual papers of 1948 49, and consequently, his proprietary right was lost and got vested in the State on the coming into force of the Act; Rahmatullah Khan vs Mahabir Singh, I. I,. R. , disapproved. 125 Chhote Khan vs Mohammad Obedullakhan, I. L. R. , distinguished. (4) since the Act did not provide for the outgoing proprietor to recover possession of land by any process of law if he had become entitled to the possession of that land before the date of vesting, his right to get possession by executing his decree got lost to him after the date of vesting; and (5) the executing court should, therefore, have refused to execute the decree holding that it became inexecutable on account of the change in law and its effect.

ION: Criminal Appeal No. 71 of 1961 . Appeal from the judgment and order dated January 18, 1961 of the Calcutta High Court in 51 Criminal Appeals No. 314. 318 an(l 319 of 1960 and Reference No. 3 of 1960. Nur ud din Ahmed and Pritam Singh Safeer, for the appellants. D. N. Mukherjee, P. K. Mukherjee and P. K. Bose, for the respondent. October 10. The Judgment of the Court was delivered by SHAH, J. At 9 :30 P.M . On March 21, 1959, four persons Rampiari, Hiralal, Shyama Prosad Missir and Surajnath Dubey all residing within Police Station (Golabari in the town of Howrah suffered incised and punctured injuries and died in consequence thereof. The appellants and two others were tried before the Extra Additional Sessions Judge, Howrah with a jury for rioting and causing fatal injuries to these four victims and thereby committing offences punishable under sections 148, 302 and 302 read with 149 of the Indian Penal Code. The jury brought a unanimous verdict of guilty against appellants Ram Shankar Singh, Bimala and Sudama Singh for offences punishable under ss.148,302 and 302 read with 149 of the Indian Penal Code and against Ramnarayan Missir for offences punishable under sections 148 and 326 read with 149 of the Indian Penal code and a verdict of not guilty against Depali wife of Ramnarayan Missir The Sessions Judge accepted the verdict and sentenced the appellants, subject to confirmation by the High Court, to suffer the penalty of death and Ramnarayan Missir to suffer rigorous imprisonment for 10 years, and acquitted Depali. The reference for confirmation of death sentence and the appeal filed by the appellants and Ramnarayan Missir against the order of conviction and sentence were heard by the High Court of Judicature at Calcutta. The High Court held that the verdict of the jury was vitiated on account of misdirection by the Sessions Judge, and after an elaborate examination of the evidence found the appellants Ram Shankar and Bimala guilty of offences under 302 read with 34 of the Indian Penal Code for causing the death of Rampiari and Hiralal, The 52 High Court also found appellant Ram Shankar guilty of murder for causing the death of ,Surajnath Dubey by stabbing, him With a knife, and appellant Sudama Singh for causing the death of Shyama Prosad Missir by stabbing him with a knife, and confirmed the sentence of death passed by the Sessions Judge. The High Court, acquitted Ramnarayan Singh of the offence of grievous hurt of which he was convicted by the trial court. With certificate granted by the High Court this appeal is preferred by the three appellants. Two bustees in the town of Howrah No. 7 Madhab Ghosh Road and No. 7 Tikiapara Road are separated by a common courtyard. Ram Shankar, Bimala, Ramnaryan Singh and Depali lived in No. 7 Madhav Ghosh Road. Ramdeo Ahir, his wife Rampiari and son Hiralal lived in a room in 7 Tikiapara Road and Shyama Prosad Missir lived in another room in that bustee. Surajnath Dubey lived in a room in No. 9 Madhab Ghosh Road. At about 11 A. M. On March 21, 1959 there was an altercation in the common courtyard between Ramnarayan Missir, his wife Depali and Ram Shankar 's wife Bimala on the one hand and Ramdeo, his wife Rampiari and his son Hiralal on the other. This attracted the attention of several residents of the locality, and the parties were pacified by Jadunandan Roy and Joy Lal Choudhury and were pursuaded to retire to their respective room. At about 7 P. M. On the same day, after Ram Shankar returned home there was another altercation and Jadunandan and others again intervened and pacified the parties, who were quarreling. Hiralal and his mother Rampiari returned to their room and apprehending an assault they chained the door from within. It was the case for the State that at about 9 r. M., 5 to 7 Hindusthani" came armed with iron rods and knives to 7 Madhab Ghosh Road and joined Ram Shankar, Sudama Singh, Bimala, Ramnarayan Missir and Depali who were also armed with lethal weapons, such as knives, 53 swords an iron roads. The whole party then proceed to No. 7 Tikiapara Road and Sudama singh broke open the door of the room of Ramdeo Ahir. Ram Shankar and his wife Bimala then entered the room, Sudama Singh standing outside. Ram Shankar and Bimala attacked Rampiari and Hiralal and stabbed them to death. On hearing the shrieks of Rampiari and Hiralal, Shyama Prosad Missir proceeded towards the courtyard, but was stabbed by Sudama Singh in the chest with a knife and collapsed on the spot. Sudama Singh was held by Jadunandan Roy, but was rescued by his Supporters who beat Jadunandan Roy with iron rods. At this juncture Ram Shankar and Bimala came out of Ramdeo 's room with their knives and cloths stained with blood. Surajnath Dubey who reached the room of Ramdeo was stabbed by Ram Shankar in his abdomen. Surajnath Dubey ran a short distance pressing his abdomen with his hands and fell down near the dispensary of one Dr. Dhruba Das Pandey where from he was removed to the Howrah General Hospital. He succumbed to his injuries on March 23, 1959. Ramnaryan Missir was present in the courtyard at the time of this assault and carried a sword in his hand and his wife Depali carried a sword iron rod. After killing Rampiari Hiralal, Shyama Prosad Missir and causing injuries to Surajnath Dubey, Ram Shankar and his supporters fled along the Madhab Ghosh Road. The sword carried by Ramnarayan was snatched away by Jivan Prosad Sett and in doing so the latter received a slight injury Ramnarayan and his wife Bimla and others were chased by a large crowd, but many of the miscreants made good their escape. Ramnarayan and his wife Depali took shelter in the house of one Lakshman Mahato. Ram Shankar, Bimala and Sudama Singh entered the godown of Bhola Singh at Sailen Bose Road. In the meantime, the officer incharge of the police station having received information on the telephone proceeded to Bhola Singh 's godown and 54 arrested Sadaman Singh and Bimala, Ram Shankar having run away from the godown. Sudama Singh and Bimla were brought to the scene of offence injuries on the dead bodies of Rampiari, Hiralal Shyama prosad Missir were examined. Information of tho offence was the recorded. At the trial of the appellants and other accused evidence was led in support of the case for the State that quarrels took place at 11 A. and 7 p.m. On the day in question between Rampiari and Hiralal on the one hand and Bimala, Ramnarayan Singh and Depali on the other and that at the quarrel at 7 P. M. Ram Shankar was also present. Evidence was also led to show that shortly after 9 P.M. Ram Shankar, his wife Bimala accompanied by Sudama Singh Ram Shankar 's cousin Ramnarayan Missir and his wife Depali and five or seven Hindusthani men approached the courtyard in front of No. 7 Tikiapara Road and Sudama Singh broke open the door of the room of Ramdeo Ahir and Ram Shankar and his wife Bimala entered the room armed with knives and emerged from the room sometime later with knives stained with blood. Evidence was also led that Shayama Prosad Missir was stabbed by Sudama Sihgh and Surajnath Dubey by Ram Shankar in tho presence of witnesses. The State also led evidence that the fleeing miscreants were chased by the residents of the locality and that Bimala and Sudama Singh were arrested in the godown of Bhola Singh. Before the High Court the verdict of the jury was successfully assailed by counsel for the appellants. The learned Judges of the High Court held that the verdict was vitiated on account of misdirection on material questions, and they accordingly disregarded the verdict and proceeded to consider the evidence independently of the verdict. They held that appellants Nos. l and 2 Ram Shankar and his wife Bimala were guilty of offences punishable 302 read with 34 of 55 the Indian Penal Code for causing in furtherance of their common intention death of Rampiari and Hiralal in the room of Ramdeo Ahir. The High Court also held Ram Shankar guilty of causing the death of Surajnath Dubey, and Sudama Singh of causing the death of Shyama Prosad Missir by stabbing him in the chest. The first question that falls to be determined is whether the High Court was, in the circumstances of the case, competent to appraise the evidence after discarding the verdict of the jury and to confirm the sentence of death after modifying the order of conviction. Section 423 of the Code of Criminal Procedure invests the High Court hearing on appeal against all order of conviction or acquittal passed by a Subordinate court of criminal jurisdiction with certain powers. These powers are exerciseable in appeals against orders passed in proceedings which are tried with or without the aid of jury. By section 418 (l), an appeal, in a case tried by jury, lies only on a matter of law. But if the High Could on a consideration of the materials on the record reaches the conclusion that the verdict in a case tried with jury erroneous owing to some misdirection by the Judge of misunderstanding of the law by the jury, the High Court has the power to reverse the finding and to acquit or discharge the accused or to order retrial or to alter the finding maintaining the sentence, or, with or without altering the finding, to reduce the sentence, or with or without such reduction and with or without altering the finding to alter the nature of the sentence. The High Court may in an appeal against an order of acquittal even in a case tried with jury reverse the order and direct that further inquiry be made or that the accused be retried or committed for trial, or the High Court may find the accused guilty and pass sentence on him according to law. These powers can be effectively exercised only if the High Court has the power to appraise the evidence and 56 that is made clear by sub section (2) of section 423, which by the clearest implication enacts that the Appellate Court may alter or reverse the verdict, if it be of the opinion that it is erroneous owing to misdirection by the Judge, or misunderstanding of the law by the jury. The power to direct retrial or to consider the case on the merits being conferred on the High Court in appeals against orders of acquittal as well as conviction, it can effectively be exercised only if the High Court is competent apart from the verdict to appraise the value of the evidence on which the order of the trial court is founded. The High Court is not bound when it arrives at the opinion that the verdict of the jury is vitiated to interfere with the verdict. The Court is, therefore, competent in appeals against orders of conviction and sentence or against orders of acquittal even in cases tried with jury to order a retrial or to maintain the convection and sentence on a reconsideration of the evidence. Counsel for the appellants does not challenge this interpretation of the powers of the High Court under sections 418 and 423 of the Code. In Abdul Rahim vs Emperor (1) in dealing with the powers of a High Court in a reference under section 374 for confirmation of death sentence passed by the Court of Session n a trial held with jury, where the verdict of the jury was found to be vitiated on the ground of admission of evidence, which, in law, was inadmissible, the Judicial Committee of the Privy Council observed: :Where inadmissible evidence has been admitted in trial by jury, the High Court on appeal may, after excluding such evidence, maintain a conviction, provided the admissible evidence remaining is in the opinion of the Court sufficient to establish the guilt of the accused. The High Court is not bound to order retrial in such cases. " (l) (1946) L. R 57 The Judicial Committee also observed "The primary duty of the Court on an appeal is indicated in section 423(1). It is to consider with the record before it whether there sufficient ground for interfering '. In a trial by jury, that there has been a misdirection is not of itself a sufficient ground to justify interference with the verdict. The Court must proceed to consider whether the verdict is erroneous owing to the misdirection or whether the misdirection has in fact occasioned a failure of justice. If the Court so finds then it has a plain justification for interfering and indeed a duty to do so. " The Judicial Committee also observed, "An appeal may be entertained only on a question of law, but once it has been held by the Appellate Court that there has been an error in law it is open to it to interfere ' with the jury 's verdict and if it thinks that the error in law affords sufficient ground for doing so it will then proceed to consider which of the various forms of 'interference ' it will adopt. Section 4,3 clearly indicates that within its meaning a misdirection by the Judge falls within the category of error in law, for it contemplates in sub s.(2) that an appeal is competent on the ground of misdirection. But a misdirection having been found to have occurred it is not necessarily a ground for interference. It may have been of a more or less trivial character. But if it has led to an erroneous verdict being returned or to a failure of Justice the statute plainly indicates that a case for interference has arisen. What form the interference shall take is left to the Court which is given a wide discretion. It need not order a retrial. It may for example acquit the accused. To order a retrial might well operate injustice in readily conceivable circumstances. " 58 We ale therefore of the opinion that s.423 applies to all appeals before the High Court whether from a trial by jury or otherwise and then the High Court finds that the verdict of the jury is vitiated on account of someone defect of law or misdirection it has full power to deal with the appeal in the manner specified in section 423 and for that purpose it may appraise the evidence to decide what course it will follow. But it is contended that where the Court of Session in a trial held by jury sentences the accused to suffer the penalty of death and the case is submitted to the High Court under section 374 of the Code of Criminal Procedure for confirmation of sentence and the accused also appeals against the order of conviction and sentence, the High Court is bounded to hear and decide the appeal in the first instance, and if on a consideration of the appeal, the High Court holds that the verdict was vitiated on account of misdirection or misunderstanding of the law on the part of the Jury, the verdict must, be set aside and with the disappearance of the verdict disappearance the order of sentence, and it is not open to the High Court to confirm the sentence of death on a reappraisal of the evidence. The High Court is bound in these cases, says counsel for the appellants to order retrial of the accused. An appeal under sub section (l) of 8. 418 of the code lies on a matter of fact as well as on matter of law, except where the trial is by Jury, in which case the appeal lies on a matter of law only. But that is not the only provision which invests the High Court with jurisdiction to deal with the case of an accused person when he is tried by jury and is sentenced to suffer death. The sentence of death passed by the Court of session in a reference under 8. 374 of the code cannot be executed unless it be confirmed by the High Court. Under section 376 the High Court dealing with a case submitted to it under 8. 374 (l) may confirm the sentence, or pass 59 any other sentence warranted by law, or (b) may annul the conviction, and convict the accused of any offence of which the Sessions Court might have convicted him, or order a l new trial on the same or an amended charge, or (c) may acquit the accused person. These powers are manifestly of wide amplitude, and exercise thereof is not restricted by the provisions of section 4l8 (l) and 423 of the Code Of Criminal Procedure. Irrespective of whether the accused who is sentenced to death prefers an appeal, the High Court is bound to Consider the evidence and arrive at an independent conclusion as to the guilt or innocence of the accused and this the High Court must do even if the trial of the accused was held by jury. In a case where the death sentence is imposed no sanctity attaches to the verdict of the jury. The verdict is not binding if the High Court holds on the evidence that the order of conviction is not warranted. Indeed, duty is imposed upon the High Court to satisfy itself that the conviction of the accused is justified on the evidence, and that the sentence of death in the circumstances of the case, is the only appropriate sentence. It has been the uniform practice of the High Court in India to hear the reference for confirmation of sentence of death and the appeal preferred by the accused together and to deal with tho merits of the case against the accused in the light of all the material questions of law as well as fact and to adjudicate upon the guilt of the accused and the appropriateness of the sentence of death In this case also, the High Court did hear the reference and the appeal together. On the view that the verdict of the jury was vitiated, the High Court was obliged to consider what order in the circumstances of the case was appropriate. The High Court was not bound in exercising powers under 8. 423 to order a retrial; it could exercise any of the powers under 8. 423(1)(b). The High Court had also to consider what order should be passed OD the reference under section 374, and to decide on an appraisal of the evidence 60 whether the order of conviction for the offences for which the accused were convicted was justified and whether, having regard to the circumstances, the sentence of death was the appropriate sentence. High Court is of course competent when dealing with a reference under section 374 to order a retrial but the High Court is not bound to do so in every 3 tried with jury when the verdict of the jury is found to be vitiated because of error of law or misdirection. The right, of trial by jury is an important right conferred upon accused persons in the trial of certain serious offences; but under our jurisprudence the right to trial by jury is a creation of statute and the question whether the accused in a given case having had the benefit of a trial by jury should because of misdirection be ordered to be retried, or his case be considered on the evidence by the appellate court, is one of the discretion and not of right. The High Court has, in the present case, exercised this discretion and we see no adequate ground to interfere with the exercise of that discretion. Learned counsel for the State invited our attention to judgment of this Court in Bhusan Biswas vs The State of West Bengal (1), in which this Court set aside the order passed by High Court directing retrial of a case which was tried with jury, in which the verdict was vitiated, and ordered that the High Court should hear the case on the evidence. The Court in that case observed, "In the circumstances of this case we are of the opinion that the High Court was in error in remanding the case for retrial; it should have followed the procedure laid down in the Privy Council case and should have gone into the evidence and determined for itself whether the accused were guilty or not." It is manifest that this Court vacated the direction of the High Court ordering retrial in the special circumstances of the case: the Court did not lay down any general rule that in every case where the verdict (1) Cr. A. 113 of 1956, decided on February 14,1957, 61 of the jury in a case where the accused has been convicted at a trial held with jury is found to be h vitiated the High Court must not remand the case for retrial. Counsel for the appellants, contended that in this case there had been no proper trial of the appellants before the Court of Session and therefore the order of the High Court should he set aside and retrial ordered. Counsel strongly relied upon the manner in which the examination of the accused under 8. 342 by the court of Session was conducted and submitted that the Sessions Judge asked complex questions to each of the accused relating to several distinct pieces of evidence brought on the record. For instance, Ram Shankar asked "You have heard the evidence as well as the cross examination of the prosecution witnesses. They have stated that you together with your wife Bimala Devi, brother Sudama Singh, Ramnarayan Missir and his wife Depali Missir and 5/7 other Hindusthani men armed with iron rods, daggers and swords formed an unlawful assembly at No. 7 Tikiapara Road on the 21st March, 59 with the intention of murdering one Rampiari and her son Hiralal and that you intentionally killed Rampiari and Suraj Dubey of 9 Madhab Ghosh Road with a knife. Do you want to say anything in your defence in connection with this charge?" Similar questions were also asked of accused Bimala and Sudama Singh. With regard to the events subsequent to the murder of Rampiari, Hiralal and Shyama Prosad Missir another complex question was asked. It is urged that the examination of the accused held in this manner was not in accordance with section 342 of the Code of Criminal Procedure, the terms whereof are mandatory and the Sessions Judge having failed to comply therewith the accused it must be presumed were prejudiced. It was submitted in support of this contention that if the several components of the questions which dealt with independent matters on which evidence was led by the prosecution had 62 been split up, the accused might have given some explanation acceptable to the jury. The Sessions Judge having failed to do so, the trial must be regarded as vitiated. In our view, the learned Sessions judge in rolling up several distinct matters of evidence in a single question acted irregularly. Section 342 of the code of Criminal Procedure by the first sub section provides, in so far as it is material: "For the purpose of enabling the accused to explain any circumstances appearing in the evidence against him, the Court . . . . . . . shall . . . question him generally on the case after the witnesses for the prosecution have been examined and before he is called on for his defence. " Duty is there by imposed upon the Court to question the accused ganerally in a ease after the witnesses for the prosecution have been examined to enable the accused to explain any circumstance appealing against him. This is a necessary corollary of the presumption of innocence on which our criminal jurisprudence is fonded. The object of the section is to afford to the accused an opportunity of showing that the circumstance relied upon by the prosecution which may be prima facie against him, is not true or is consistent with his innocence. The opportunity must be real and adequate. Questions must be so framed as to give to the accused clear notice of the circumstances relied upon by the prosecution, and must give him an opportunity to render such explanation as he can of that circumstances. Each question must he so frilled that the accused may be able to under stand it and to appreciate what use the prosecution desired to make of the evidence against him. Examination of the accused under section 342 in not intended to be an idle formality, it has to be carried out, in the interest of justice and fairplay to the accused: by a slipshod examination which is the result of imperfect appreciation of the evidence, 63 idleness or negligence the position of the accused cannot be permitted to beamed mere difficult than what "it is in a trial for an offence. This Court pointed out in Ajmer Singh State of Punjab(1) that "it is not a sufficient compliance with the section (s.342 Code of Criminal Procedure) to generally ask the accused that, having heard the prosecution evidence what he has to say about it. He must be questioned separately about each material circumstance which is intended to be used against him. The whole object of the section is to afford the accused a fair and proper opportunity of explaining circumstances which appear against him and the questions must be fair and must be couched in a form which an ignorant or illiterate person may be able to appreciate and understand. " The examination by the Sessions Judge of the appellants perfunctory, but as observed in Ajmer Singh 's case, every error or omission complying with section 342 does not vitiate the trial. "Errors of this type fall within the category of curable irregularities and the question whether the trial has been vitiated depended in each case upon the degree of error and upon whether prejudice has been or is likely to have been caused to the accused". To the questions asked by the. judge, the answers given by the appellants were either "I am innocent" or "the story is false". Failure on the part of the Sessions Judge to split up the questions so as to deal with each distinct feature or material piece of evidence separately, however, does not, in the circumstance as of the present case, justify an inference that prejudice was thereby caused to the appellants. accused for the appellants has not been able to suggest, having regard to the line of cross examination adopted and the criticism of the evidence of the prosecution witnesses offered by him, what explanation besides completo denial of the prosecution story, the appellants could have offered in answer to the questions relating to the different circumstances and pieces or features of evidence (1) ; 64 on which the prosecution relied. It is true that the prosecution strongly relied upon two circumstances against Bimala (1) that when she came out of the house of Ramdeo Ahir, she had a blood stained knife in her hand and (2) that when she was arrested from the godown of Bhola Singh; the knife was in her hand. To these matters of evidence attention of the accused Bimala does not appear to have been invited. Similarly. attention of Ram Shankar to the evidence that when he came out of the room of Ramdeo Ahir, he had a knife in his hand was not invited. But we have already observed, beyond a bare denial, the learned counsel was unable to suggest any other answer which the accused could give to these pieces of evidence even if they had been specifically put to them. It is also to be noticed that the plea that the appellants had not been properly examined under 8. 342 of the Code of Criminal Procedure was not raised before the High Court: at least there is no reference in the judgment of the High Court to any such argument. Failure to comply with the provisions of section 342 an irregularity; and unless injustice is shown to have resulted therefrom a mere irregularity is by itself not sufficient to justify an older of retrial. The appellate court must always consider whether by reason of failure to comply with a procedural provision, which does not affect the jurisdiction of the court, the accused have been materially prejudiced. In the present case, we are of the view, having regard to the circumstances, that the appellants have not been prejudiced, because of failure to examine them strictly in compliance of the terms of s 342 of the Code and that view is strengthened by the fact that the plea was not raised in the High Court by their counsel who had otherwise raised numerous question in support of the case of the appellants. Rampiari, her son Hiralal, Shyama Prosad Missir and Surajnath Dubey received fatal injuries shortly after 9 P.M. On the night of March 21, 65 1959. Rampiari had on her person two incised injuries on the left side of chest cutting through the Ra ribs. Hiralal had six injuries on his chest, abdomen and arms four incised injuries and two punctured. Shyama Prosad Missir had one injury on the chest piercing the thoracic cavity. Surajnath Dubey had injury in the abdomen. These injuries were in the ordinary course of nature sufficient to cause death. The appellants contend that they were not responsible for the injuries to these victims. We were taken through the entire evidence which is material to the case of the three appellants by the learned counsel for the appellants. In respect of the first incident when took place in the morning of the fateful day, there is the evidence of Jadunandan Rao which is corroborated by the statement contained in the First Information Report, and also corroborated by the statement of Ramdeo husband of Rampiari. The second incident, took place at about 7 P. M. The witnesses in connection with that incident are Jadunandan Roy, B. P.Singh and Jangli Bahadur. It appears from the evidence of these witnesses that the parties Rampiari and Hiralal on the one hand and Ram Shankar, his wife Bimala Devi, Ramnarayan Missir and his wife Depali on the other were quarrelling and were pacified and Rampiari and Hiralal were persuaded to go back to their room and bolt it from inside. The High Court has believed the evidence relating to these two incidents and we see no reason for not accepting it. The third incident consists of three phases (i ) assault upon the room of Ramdeo Ahir, the breaking open of the door and attack on Rampiari and Hiralal resulting in their death; (2) assault on Shyama Prosad Missir by Sudama Singh and (3) assault on Surajnath Dubey. The evidence discloses that the common courtyard between 7 Madhab Ghosh Road and 7 Iikiapara Road was lit up by the light of an electric lamp in the house of Joy Lal Choudhury, two of the 66 windows of the first floor being open. There is also the evidence that in the room of Ramdeo on the occasion in question a kerosene lantern was burning. It is so recited in the First Information Report and the kerosene lantern was seen by the Sub Inspector of Police when he arrived on the scene of offence. It cannot be disputed, therefore, that the scene of offence was fully lighted at the time of the assault and the witnesses could identify the assailants. About the assault upon the room of Ramdeo Ahir and the entry of appellants Ram Shankar and his wife Bimala Devi into the house after the door was broken open by Sudama Singh, there is the evidence of as many as six eye witnesses they are Jadunandan Roy, Ram Chandra Goala, Tribeni Jadab, Sukdeo Majhi, Hosila Jadab and Sundar Jadab. Thc First Information Report lodged by Jadunandan Roy substantially gives the same story. Jabunandan Roy has deposed to the entire story of the breaking open of the doer by Sudama Singh and the entry by Ram Shankar and Bimala into the room, the shrieks of Rampiari and Hiralal and about Ram Shankar and Bimala coming out of the room after stabbing Rampiari and Hiralal. Ram Chandra Goala stated that when he came near the house of Ramdeo he found Ram Shankar and Bimala coming out of the room with knives in their hands. Tribeni Jadab stated that he saw Sudama Singh breaking open the door of Ramdeo Ahir with an iron rod, that thereafter Ram Shankar and Bimala entered the room each carrying a knife, that is heard shrieks of Rampiari and Hiralal and that after some time Ram Shankar and Bimala came out of the room with knives. Sukdeo Majhi stated that he saw Ram Shanknr and Bimala coming out of Ramdeo 's room with knives in their hands. There is also the evidence of Hosila Jadab who stated that he saw Ram Shankar and Bimala coming out of Ramdeo 's room with blood stained knives. Sundar Jadab has stated that when he reached the courtyard he found Sudama Singh 67 breaking open the door of Ramdeo 's room with all iron rod and thereafter Ram Shankar and his wife getting into the room with knives in their hands, and he heard Hiralal and his mother shouting for some time. The High Court has accepted the testimony of these witnesses. It is true that Jadunandan Roy stated that, he saw through the open door of the room of. Ramdeo Ahir, after it was broken open, Ram Shankar stabbing Rampiari and Bimala stabbing Hiralal and the High Court regarded this part of the story as an embellishment which must be discarded. The mere fact that the witness Jadunandan Roy had improved his story will not by itself be sufficient to disregard his testimony in its entirety. About the assault on Shyama Prosad Missir, when he tried to intervene,there is the evidence of Jadunandan Roy, Tribeni Jadab, Sukdeo Majhi, Hosila Jadab and Sundar Jadab. Each of these witnesses has deposed that Shyama Prosad Missir who intervened was stabbed by Sudama Singh in the abdomen. About the assault on Suraj Dubey by Ram Shankar, there is the evidence of Jadunandan Roy, Tribeni Jadab and Hosila Jadab. In the cross examination of these witnesses for the production, it was suggested that there was a free fight between some "Hindusthanis" and "goalas", in the course of which injuries may have been suffered by Rampiari, Hiralal, Shyama Prosad Missir and Suraj Dubey. But Rampiari and her son Hiralal were found dead in their own room: the dead bodies were lying of a cot. The body of Shyama Prosad Missir was lying with a single injury at the gate of 7 Tikiapara Road and Surajnath Dubev was stabbed a short distance away. There is no evidence of any serious injuriy suffered by any other person. If there had bee a free fight, some injuries to participants on both the sides may reasonably be expected. It is true that according to the prosecution besides the accused there were 68 present 5 or 7 Hindusthani men, who were also armed. There is no evidence, however, that any of these Hindusthanis took any active part in the assault on Rampiari, Hiralal, Shyama Prosad and Surajnath. The Hindusthanis were not identified and have never been traced; but there is no evidence that they participated in the assault. The story of a free fight, between the goalas and the Hindusthani men has been discarded by the High Court and, in our judgment, properly. Certain matters of general criticism of the evidence were also urged by the learned counsel for the appellants. He contended that no reliance should be placed on the contents of the First Information because it showed inherent evidence that it must have been fabricated some time after the investigating officer commenced investigation and in support of that contention reliance was placed upon the fact that even though it was alleged to have been despatched on the night of March 21, 1959 from the police station, a copy of the First information reached the Sub Divisional Magistrate Howrah on March 26, 1959. Section l57 of the Code of Criminal Procedure enjoins that a copy of the First Information Report be sent forthwith to the Magistrate having jurisdiction. It is also true that the copy of the First Information Report passed through the Court Inspector 's office on March 25, 1959 and reached the Sub Divisional Magistrate on March 26, 1959. The Sub Inspector of Police in charge of the investigation stated in his cross examination that he could not explain why the copy did not reach the Sub Divisional Magistrate before March 26, 1961. If, however, it was the case that the copy was not despatched from his office at the time when it was claimed it was despatched, further cross examination should have been directed, the mere endorsement of 26th March, 1959 as the date on which the First Information reached the Sub Divisional Magistrate is not 69 in itself sufficient to disregard a mass of direct evidence. It was then urged that the story that Bimala was carrying a knife even when she was arrested was on the ground of utter improbability unreliable. It was urged that the normal reaction of an assailant running away from the scene of offence to escape arrest would be to throw away the weapon of offence. But this argument based on mere improbability would not be sufficient body of disinterested testimony about the knife being in her hand when she was arrested. It was also submitted that the story of Jadunandan Roy that he caught Sudama Singh after the latter had stabbed Shyama Prosad Missir is untrue. It was urged that if Sudama Singh, who was armed with a knife was over powered by Jadunandan Roy, the story that Sudama Singh ran away with the other assailants could not be true. But Jadunandan in his evidence has deposed that when he caught Sudama Singh he was assaulted by others who accompanied Sudama Singh and was struck on his head and on other parts of body with a rod. This story is corroborated by the medical evidence about injuries on the person of Jadunandan Roy Learned counsel for the appellants strongly relied upon the fact that even though a large majority of the prosecution witnesses who came near 7 Tikiapara Road deposed to the presence of Ramnarayan Missir and his wife Depali and further deposed that Ramnarayan Missir had a sword in his hand, the Sessions Judge acquitted Depali and the High Court acquitted Ramnarayan. It is urged that if the testimony of these witnesses who deposed to the presence of Depali and Ramnarayan Missir is found to be untrue, the Court should scrutinize the evidence of the other witnesses witnesses with care and having regard to the unsatisfactory features disclosed in the cross examination, the rest of the evidence should also be discarded. But it was not the evi 70 dence of any of the witnesses for the prosecution that Depali had taken part in the assault. Her presence with a rod in her hand is deposed to by the witnesses ut it is not alleged that she had taken any part in the assault on any one. Similarly, though there was evidence that Ramnarayan Missir was present carrying a sword, yet the High Court on a consideration of the evidence came to the conclusion that in the absence of reliable evidence that he participated in the assault near 7 Tikiapara Road the case against him was not proved. We do not think; that because the High Court held the case against Ramnarayan as not established, the prosecution evidence in its entirety may be disregarded. On a review of the evidence, we hold that the First Information about the commission of the offence was given immediately: in the First Information the names of the three appellants and the part played by them was set out in detail. The police officer who arrived on the scene shortly after the incident found the door of Ramdeo Ahir 's room broken and blood marks were found at various places in Ramdeo Ahir 's room as well as in the courtyard. Many of the witnesses who supported the case for tho State wore disinterested and independent. No injuries were found on any of the party of the accused which could be attributed to a fight between their party men and the goalas. Having regard to these circumstances, we are of tho view that the High Court was right in holding that the prosecution story was true. Counsel for the appellants submitted that, in any event, against Sudama Singh the evidence was not strong enough to warrant his conviction. It was contended that Sudama Singh resides not in Madhab Ghosh Road but in the godown in which he was arrested. It is also urged that no extensive blood marks were found on his clothes and the knife alleged to have been used by him is not found. In our opinion, there is a mass of reliable evidence 71 against Sudama Singh which establishes his presence at the scene of the offence and the part played by him. There is the evidence of five eye witnesses to which we have already referred. His presence at the scene is corroborated by the testimony of Basanta Prosad Singh who had heard Depali shouting shortly before the assault commenced that Sudama Singh had arrived. Then there is the evidence of Jiban Prosad Sett who deposed that he ad on the night in question Then Ram Shankar, Sudama Singh, Bimala and Ramnarayan Missir, all coming from Madhab Ghosh Road towards Tikiapara Road and that he had seen Sudama Singh with a knife. Sewdhari Sharma stated that he had been Sudama Singh and 3 or 4 other persons running away from the scene of offence and at that time he had a knife in his right hand. Subinspector Deepak Das stated that he had arrested Sudama Singh near the godown. Sub Inspector Z. Haque attached the dhoti from the person of Sudama Singh and that dhoti was sent to the Chemical Analyses an I Serologist. According to the Chemical Analyses the dhoti, bore blood marks. In the seizure list the dhoti is described as having "slight" blood stains and the Assistant Serologist reported that the blood on the dhoti, was so disinterested that its origin could not be determined. The testimony of Jadunandan Roy, Tribeni Jadab, Sunder Jadab, Jiban Prosad Sett, and Sukdeo Majhi abundantly establishes the presence of Sudama Singh at the scene of the offence and the part played by him. He is also seen running away from the scene of offence. The knife carried by him is not found: blood marks found on his dhoti are also not proved to be human in origin, but, having regard to the evidence of the eye witnesses, which is both independent and disinterested, we see no reason to disagree with the view of the High Court that Sudama Singh was present at the scene of offence and he broke open the door of Ramdeo Ahir 's house to facilitate the entry of Ram Shankar and 72 Bimala to murder Rampiari and Hiralal and that he stabbed Shyama Prosad Missir with a knife. Ram Shankar and Bimala forceably entered the house of Ramdeo Ahir and killed Rampiari and Hiralal. Ram Shankar also stabbed Suraj Dubey when he attempted to protest against his conduct. Sudama Singh, besides breaking open the door of Rmdeo Ahirs room to facilitate the entry by Ram Shankar and Bimla stabbed Shyama Prosad Missir when the latter tried to intervene. The assault upon the members of the family of Rmdeo Ahir was conceived and initiated with deliberation, and with the object of slaughtering a defenceless woman and her young son. Innocent persons who intervened were mercilessly stabbed and killed. There is no ground, therefore, for disagreeing with the High Court that this is pre eminently a case in which death sentence should be imposed on the three appellants. On the view taken by us this appeal fails and is dismissed. Appeal dismissed.

The appellants and two others were tried by the Court of session sitting with a jury for rioting and causing fatal injuries to certain persons. The jury brought a unanimous verdict of guilty against the appellants. The Sessions Judge accepted the verdict and sentenced them subject to confirmation by the High Court to suffer the penalty of death. The reference for confirmation of death sentence and the appeal filed by the appellants against the order of conviction and sentence were heard by the High Court which held that the verdict of the Jury was vitiated on account of misdirection on material questions by the Sessions Judge, and thus disregarded the verdict and proceeded to consider the evidence independently of the verdict and after an elaborate examination of the evidence found the appellants guilty of the offences punishable under section 302 read with 8. 34 of the Indian Penal Code and confirmed the sentence of death. It was contended that (I) the High Court was not competent to appraise the evidence after discarding the verdict of the jury and to confirm the sentence of death after modifying the order of conviction, (2) where the High Court had held that the verdict was vitiated, on account of misdirection or misunderstanding of law and had set the verdict aside, then with the disappearance of the verdict the order of sentence also dissppeared and it was not open to the High Court to confirm the sentence and the High Court was bound to order a re trial and (3) that the accused were prejudiced when under section 342 of the Code of Criminal Procedure, they were asked complex questions which could not be understood by them. ^ Held, that section 423 of the Code of Criminal Procedure applies to all appeals before the High Court whether from a trial by jury or otherwise and when the High Court finds that the verdict of the jury is vitiated on account of some error of law or misdirection it has full power to deal with the appeal in the manner specified in section 423 of the Code and for that purpose it may appraise the evidence to decide what course it 50 will follow, and was not bound in exercising powers under section 423 to order a retrial; it could exercise any of the powers under section 423(1)(h). Held further, that the powers under sections 374(1) and 376 of the Code are manifestly of wide amplitude and exercise thereof is not restricted by the provisions of section 418(1) and section 423 of the Code. Irrespective of whether the accused who is sentenced to death prefers an appeal, the High Court is bound to consider the evidence and arrive at an independent conclusion as to the guilt or innocence of the accused and this the High Court must do even if the trial of the accused was held by jury. In a case where the death sentence is imposed no sanctity attaches to the verdict of the jury. The verdict is not binding if the High Court holds on the evidence that the order of conviction is not warranted. On a reference under section 374 duty is imposed upon the High Court to satisfy itself that the conviction of the accused is justified on the evidence, and that the sentence of death in the circumstances of the case is the only appropriate sentence. When dealing with a reference under section 374 of the Code the High Court was competent to order a retrial but is not bound to do so in every case tried with jury when the verdict of the jury is found to be vitiated because of error of law or misdirection. The right of trial by jury is an important right conferred upon accused persons in the trial of certain serious offences. The question whether the accused having had the benefit of a trial by jury should because of misdirection be ordered to be retried, or his case be considered on the evidence by the appellate could, is one of discretion and not of right. Held, also, that the failure to comply with the provisions of section 342 of the Code is an irregularity and unless injustice is shown to have resulted therefrom a mere irregularity is by itself not sufficient to justify an order of retrial. The appellate court must always consider whether by reason of failure to comply with a procedural provision, which does not affect the jurisdiction of the court, the accused have been materially prejudiced. Abdul Rahim v, King Emperor (1946) L. R. 73 I. A. 77 and Ajmer Singh vs State of Punjab ; , referred to.

Appeals Nos. 220, 221, 349 and 497 of 58. Appeals from the judgment and decrees dated 1955 March 24,1956 September 15 and 1956 April 12 of the former Saurashtra High Court at Rajkot in Civil Second Appeals Nos. 123 of 1953 & 104 of 1955 and Civil Appeals Nos. 42 of 1953 and 50 of 1954. M. C. Setalvad, Attorney General for India, C. K.Daphtary, Solicitor General of India, B. Sen and R. H. Dhebar, for the Appellant (In all the Appeals). I. N. Shroff for the Respondents (In C. As. Nos. 220 and 221 of 1958). G.S. Pathak, N. P. Nathnwni and K. L. Hathi for the Respondents (In C.A. No. 349 of 1958). J.P. Mehta, J. B. Dadachanji, Onkar Chand Mathur and Ravinder Narain, for the Respondents C.A. No. 497 of 1958). October 3. The Judgment of Sinha, C.J., section K. Das and N. Rajagopala Ayyangar,, JJ. was, delivered by section K. Das, J. The Judgment of Sarkar and J. R. Mudholkar, JJ., was delivered by J. R. Mudholkar, J. section K. DAs, J. These four appeals which have been brought to this Court on certificates granted by the then High Court of Saurashtra under article 133 of the Constitution fall into three groups, and have been heard together. The essential facts relating to these appeals are the same, and 'a common question of law now falls for determination on those facts. 973 The State of Gujarat., within whose territories the disputed properties are now situate, is the appellant in the appeals. The respondents and in some cases their. ancestors, obtained grants from the then Nawab of Junagadh, which was then a ruling State, in respect of lands and, in one case, of a building known as "Datar Manzil '. These grants were repudiated or cancelled and the property, subject of the grant, was resumed by the Administrator who took over charge of the administration of Junagadh on behalf of the Dominion of India in 1947 in circumstances which we shall presently state. The respondents brought suits challenging the validity of the orders made by the Administrator. These suits were decreed by the lower court and the decrees were substantially upheld by the High Court of Saurashtra. The principal point for decision in these appeals is whether the impugned orders made by the Administrator arose out of and during an act of State which was not justiciable in the municipal courts. This is the only point which has been agitated before us on behalf of the, appellant State and very strong reliance has been placed on the decision of this Court in the State of Saurashtra vs Memon Haji Ismail Haji (1) where, in circumstances same as those of the appeals before us, it was held that the act of the Dominion of India in assuming the administration of Junagadh was an act of State pure and simple and the resumption of the grant in question therein having been made by the Administrator before that act was completed and at a time when the people of Junagadh were aliens outside the State, the act of resumption, however arbitrary, was an act of State on behalf of the Government of India and was not, therefore, justiciable in the municipal courts. It may be here noted that by that decision this Court over ruled the earlier decision of the Saurashtra High Court in State of Saurashtra vs Memon Haji Ismail Haji Valimamad(2), (1) ; (2) A.I.R. 1953 Saurashtra 180. 974 a decision on the basis of which the High Court decided the cases under consideration in these appeals. The learned Attorney General has submitted that the decision of this Court in the State of Saurshtra vs Memon, Haji Ismail Haji completely covers and concludes the present appeals. On behalf of respondents it has been, contended that the decision aforesaid proceeded on a finding that the, act of State,. was not completed before the impugned orders were made and that finding being a finding of fact does, not bind the respondents who were not parties to the case in which the decision was rendered. In the appeals before us the main contention on behalf of the respondents has been that the impugned orders were made after the assumption of sovereignty by the Dominion of India was completed, and therefore the decision of this Court in the State of Saurashtra vs Memon Haji Ismail Haji(1) is not determinative of the problem which arise,% in these, appeals. It has been further argued that, after full sovereignty, had, been assumed by the Dominion of India, the petition of the people of Junagadh, including the respondents was not that of. aliens outside the State, but their position on such assumption of sovereignty was that of citizens of India against whom there could be no act of State and they had rights as such citizens in respect of which they could ask for relief in the municipal courts. We have set out above, in brief outline, the principal point which falls for decision in these appeals and the respective contentions of. the parties relating thereto in order to highlight the main problem presented for solution in these appeals. But we must first set out the essential facts which are relevant for the solution of the problem ' We have already stated that the essential facts , are the same in these appeals, though the facts relating (1) [1960] I section C R. 537. 975 to each ' of the grants made in favour of the respondents are, different We shall state the essential facts bearing upon. the main problem and then briefly refer to the grants made in each of the India attained independence in 1947. As from the 15th day of August, 1947, two independent Dominions were set up known respectively as India and Pakistan under the Indian Independence Act, 1947 (10 & 11 Geo. C. 30). Under section 7 of the said Act, the suzerainty of Iris Majesty over the Indian States including Junagadh lapsed. It released those States from all their obligations to the Crown. The White Paper on Indian States said (at page 32) : "It was evident that if in consequence the Indian States became separate independent entities, there would be a serious vacuum not only with regard to the political relationship between the Central Government and the States, but also in respect of the co ordination of all India policies in the economic and other fields. All that the Dominion Government inherited from the Paramount Power was the proviso to section 7 of the Indian Indepen dence Act, which provided for the continuance, until denounced by either of the parties, of agreements between the Indian States and the Central and Provincial Governments in regard to specified matters, such as Customs, Posts and Telegraphs, etc. (Appendix IV). " A process of accession was therefore begun and by August 15, 1947 all the States in the geographical limits of India barring Hyderabad, Kashmir and Junagadh had acceded to the Indian Dominion. The Nawab of Junagadh however, did not accede to the new Dominion of India by executing an Instrument of Accession as did the other Rulers in Saurashtra. He fled the country and the affairs of Junagadh State fell into disorder and chaos. At the request 976 of the Nawab 's Council, the Government of India decided to take over the administration of the State. On November 9, 1947, the Regional Commissioner, Western India and Gujarat States Region, assumed charge of the administration of the State on behalf of the Government of India. A proclamation was issued on that date which. said that the Regional Commissioner had assumed charge of the administration of the Junagadh State at 18 00 hours on November 9, 1947. On November 14, 1947 the Regional Commissioner appointed Shri section W. Shiveshwarkar as Administrator of Junagadh State. The Administrator passed certain orders which are the orders impugned in these appeals and to which we shall presently refer, but we must first complete the general picture of political changes that took place in Junagadh. In February, 1948 the Government of India held a referendum in Junagadh State to ascertain the choice of the people in regard to accession and the people voted by a large majority in favour of accession to the Dominion of India. The Administrator then decided with the approval of the Government of India to appoint an Executive Council with himself as President and three other persons as members thereof. In December, 1948 the elected representatives of the people of Junagadh resolved that the administration of the State be made over to the Government of Saurashtra and that the representatives of Junagadh be enabled to participate in the Constituent Assembly of Saurashtra ' State with a view to framing a, common Constitution for Saurashtra and the Junagadh State. It is necessary to state now how this integration took place. On January 23, 1948, thirty rulers of the principal States of Kathiawar signed a covenant bringing into existence the United State of Kathiawar (later I known as the ' United State of Saurashtra) comprising the territories of their States for the welfare of the people and entrusted to a Constituent, Assembly the. task 977 of drawing up a democratic Constitution for that State within the frame work, of the Constitution of India, to which they had already acceded. On that date Junagadh State had no Ruler nor was any Covenant signed on behalf of the Junagadh State. Later, in December, 1948, the elected representatives of the people of Junagadh, Manavadar, Mangrol, Bantwa, Babariawad and Sardargarh recommended to the Government of India and the Government of the United State of Saurashtra, as it was then called, that the administration of the States mentioned above be integrated with the United State of Saurashtra. The Rulers of the Covenanting States thereupon entered into a Supplementary Covenant with the concurrence of the Government of India to provide for such integration and for the participation of the elected representatives of the people of these States into the Saurashtra Constituent Assembly. Article 3 of the, Supplementary Covenant was in these terms (See White Paper on Indian States, page 249) : "From a date to be agreed upon between the Government of the said States and the Government of the United State of Saurashtra, with the concurrence of the Government of India, the administration of the said States shall be integrated with that of the United State of Saurashtra and thereafter the legislative and executive authority, powers and jurisdiction of the United State of Saurashtra shall extend to the said States to the same extent as it extends to the territory of any Covenanting State. . . " The administration of the Junagadh State was thereafter integrated with that of the United State of Saurashtra on January 20, 1949. Therefore, as from that date the legislative and executive authority and jurisdiction of the United State of Saurashtra extended to the Junagadh State to the same extent as it extended to the rest of the territories of the Covenanting States. 978 Further political changes took place after January 20, 1949, but with those changes we are not concerned in the present appeals. The two dates which are important for our purpose are November 91 1947, when the Regional Commissioner first took over charge of the administration of Junagadh and January 20, 1949 when Junagadh merged into the United State of Saurshtra. Now, as to the impugned orders made by the, Administrator. In Civil Appeal No. 349 of 1958 the ancestor of the respondents, had obtained grants from the then Nawab of Junagadh of two villages called Handla and Venderwad some time between the years 1865 and 1868. A detailed history of the grants so made is not necessary for our purpose. On December 6, 1947, the Administrator made the following order "It has come to the Administrator 's notice that Aba Salem Bin Abs Mahmed Hindi the alienee of Handla village, (i) was maintaining many Arab employees of Timbdi it his house in Junagadh, (ii) was uttering threats to massacre all Hindus of Handla village,. (iii) was keeping in Hendla fifty animals at the expense of the poor village people, (iv) did not pay any remuneration to Dhedh employees of his garden and was exacting Veth from them, (V) was buying exhorbitant cesses from the village people, (vi) had converted into Islam three Hindus, and (vii) had taken the, following arms from Hand to Junagadh about a month ago,: 979 (a) 12 bore guns and (b) one M. I. gun. It is, therefore, ordered that. the village J. of Handla should be taken under the State manager. The Revenue Commissioner should mak e necessary managements for the same and report compliance. By that order the management of Kandla was taken over by the State, Though there is no reference to the other village Venderwad in the order the admitted position is that the management of both the villages was taken over. Then on January 8, 1949, the Administrator passed the following order: "The Junagadh State Government is pleased to order that the land and villages comprising the Handla estate which is an Inam grant be resumed by the State forthwith. " This order also refers only to the Handla estate, but the admitted position is that both the villages were resumed by the order of the Administrator. It is the order dated January 8, 1949, which is impugned by the respondents in this appeal. In Civil Appeal No 497 of 1958 the grant was in respect of a bungalow or building known as 'Datar Manzil '. On 1 March 9, 1948 the Administrator made the following order: " The State building situated near Gadhrup Wada at Junagadb, was granted to Khan Shri Abdullkanmiyan Mahomedkhanmiyan hereditarily by Way of gift, under Dewan "Daftar Tharay No. 3379 dated lot August, The said Tharay is hereby cancelled and it is hereby ordered in the interest of the State that the said building along with all the superstructures thereon should be resumed and managed by the State as State property. " 980 In Civil Appeals Nos. 220 and 221 of 1958 a the impugned order is dated July 27, 1948, and is in these terms: "Twenty five Santis of land from the village of Khokhardea under Vanthali, Mahal was granted as a gift 'hereditarily to Mr. Mohamed Abdulla, son of late. Jamadar Abdulla Moosa under Hazur Farman No. 279 dated 30th April, 1943. In view of the principles of Alienation settlement of 1897 no grant can be wantonly favoured to anybody in contravention of the well established principles of resumption attaching to such grants. It is hereby ordered that Hazur Farman No. 279 dated 30th April, 1943, is cancelled and the land in question should be resumed by the State forthwith by setting aside the settlement made thereon. " It will be noticed, from what has been stated above that the impugned orders ' were all made after November 9, 1947, but, before January 20, 1949. The question before us is whether the orders were made in pursuance of acts of State not justiciable in the municipal courts. There can, be no doubt that if the decision of this Court in State of Saurashtra vs Memon Haji Ismail Haji (1) applies, then these appeals must be allowed. Learned counsel for the respondents has however sought to distinguish that decision on the ground that the decision proceeded on the footing that the Dominion of India assumed sovereignty over Junagadh on January 20, 1949. His contention is that when the Dominion of India assumed charge of the administration of Junagadh State on November 9, 1947, through the Regional Commissioner, Western India and Gujarat States Region, there was a complete changeover of sovereignty, the act of State was complete, and the. Dominion of India became the new sovereign; thereafter, (1) [1960] I.S.C.R. 537. 981 the people of Junagadh including the respondents, so the argument proceeded, became citizens of the Dominion of India and had rights as. such citizens it in respect of which they could ask for relief in the municipal courts. It would be apparent that this argument consists of two steps: the first step in the argument is that there was a complete changeover of sovereignty on November 9, 1947 and the act of State was complete; the second step in the argument which is really based on the correctness of the first step is that on such a change over of 'sovereignty the people of Junagadh, including the respondents, became citizens of the Dominion of India and were no longer aliens outside the Dominion. , We shall now consider the validity of the first step in the argument. In doing so we must make it clear that we must not be understood to have assented to the submission of learned counsel for the respondents that a finding as to change over of sovereignty or completion of an of State, is a finding of fact pure and simple. In our view, the question essentially is what inference in law should be drawn from the fact proved or admitted relating to the change over of sovereignty. As the matter was not argued from this stand point in the State of Saurashtra vs Memon Haji Ismail Haji(1), we have allowed learned counsel for the respondents to address us on this question. Learned counsel for the respondents has made a two fold submission: firstly, he has submitted that the question as to when the change over of ,sovereignty took place is a political question, and must or should be referred to the Government of India for opinion and the Court should abide by that opinion; secondly,he has submitted that on the facts admitted in this case, it should be hold that there. was a complete change over of sovereignty on November 9, 1947, and the act of State was complete. We do not think that either of these two submissions of learned counsel for the respon dents is correct. On the first snbmission he has (1) ; 982 drawn our attention to para. 603 at pages 285 286, Vol. 7 of Halsbury 's Laws. of England, 3rd 'Ed. That paragraph is in these terms : .lm15 " There is a class of facts which are conveniently termed "facts of State". It consists of matters and questions the, determination of which is solely in the hands of the Crown or the government, of which the following are examples (1) Whether a state of war exists between the British Government and any other State, and if so, When it began; the municipal courts have no power of inquiring into the validity of a declaration by the Crown whether a state of war exists or whether it has ended: (2) whether a particular territory is hostile, or foreign, or within the boundaries of a particular state; (3) whether and when a particular government is to be recognised as the, government of an independent state,, (4) The status of a person claiming, immunity from judicial process on the ground of diplomatic privilege. The court takes judicial notice of such facts of state, and for this purpose in any case of uncertainty, seeks information from a Secretary of State; and the information so received is conclusive. Learned counsel has also referred us to some of the English decisions on which the statements in the paragraph quoted above axe based. We consider it unnecessary to examine those decisions. , It appears to us that the question with which we are concerned in the present appeals is not a question on which it is necessary to seek information from to relevant department of the Government of India; for ' one thing, it does not appear to us that there is any uncertainty in the matter; secondly, as we shall 983 presently show, the Government of India in the relevant department has already spoken with sufficient clarity in the: White Paper on Indian States with regard to the political changes in Junagadh and what the Government of India has stated therein shows clearly enough that there was no changeover of assumption of sovereignty on 'November 9, 1947 in the sense 'which learned counsel for the respondents has contended for; lastly, it appears to us that the question with which we are concerned in these appeals is not essentially a question as to any disputed ""facts of State" the determination of which is solely in the hands of government; rather it is a question which must be determined by the court. What we have to determine in these appeals is not; the status or boundaries of a particular State territory, but the validity or otherwise of the plea taken on behalf of the appellant State that the impugned orders made by the administrator were acts "of State not justiciable in the municipal courts. There is a long line of decisions in which such a plea has been determined by courts ' of law without the necessity of obtaining the opinion of Government. The plea is really a plea with regard to the maintainability of the suits brought by the respondents and must be determined by the courts concerned. At one stage of the arguments learned counsel for the respondents referred us to s.6 of the Extra Provincial Jurisdiction Act, 1947 (XLVII of 1947) and contended that under that section it was obligatory on this court to refer the question to the Ventral Government. When however it was brought to his notice that section 6 in terms did not apply to the proceedings out of which these appeals have arisen he submitted that even if, it be not obligatory to refer the question to the Central Government, it is expedient that it should be so referred inasmuch as the answer to the question depends on "the extent of the jurisdiction" which the Dominion of India, assumed in Junagadh on November 9, 1947. This according to learned counsel, is a " 'fact of State" which only; Government can determine. 984 We have already stated there is no uncertainty about. the facts on which the plea of the appellant State is based, and Government has already spoken about them with sufficient clarity. What are these facts and how has Government spoken? We refer to para. 223 at pages 113 and 114 of the White Paper on Indian States issued by the Government of India, Ministry of States, a publication to which this Court has referred in several earlier decisions as containing the authentic opinion of Government on the political questions involved. "The position of Junagadh and certain other adjoining States in Kathiawar may also be briefly stated here. After the Nawab of Junagadh had left the State for Pakistan, the administration of the State was taken over by the Government of India on November 9, 1647, at the request of the Nawab 's Council. Obviously, the action taken by the Govern. ment of India had the fullest approval of the people of Junagadh in that the results of the referendum held in Junagadh and the adjoining smaller States in February 1948, showed that voting in favour of accession to India was virtually unanimous. During the period the Government of India held charge of the State an Administrator appointed by the Government of India assisted by three popular rep resentatives conducted the administration of the State. In December 1948, the elected representatives of the people of Junagadh resolved that the administration of the Stat e be made over to the Government of Saurashtra and that the representatives of Junagadh be enabled to participate in the Constituent Assembly of Saurashtra State with a view to framing a common Constitution for Saurashtra and the Junagadh State. Similar resolutions were adopted by the representatives of Manavadar, Mangrol,. Bantwa, Babariawad and Sardargarh. Accordingly a Supplement Covenant (Appendix XXXVI) was 985 executed by the Rulers of Kathiawar States with a view to giving effect to the aforemen tioned resolutions. The administration of Junagadh was taken over by the Saurashtra Government on January 20, 1949, and of the other States some time calling. Accordingly the Constitution treats Junagadh and these States as part of Saurashtra. " It would be clear from the aforesaid paragraph that the various steps in the assumption of sovereignty over Junagadh by the Dominion of India, between the dates November 9, 1947, and January 20, 1949, were these: (1) The administration of Junagadh was taken over by the Government of India on November 9, 1947 at the request of the Nawab 's Council; (2) during the period the Government of India held charge of the State, an Administrator appointed by the Government of India assisted by three popular representatives conducted the administration of the State; (3) in February, 1948 there was a referendum and the people of Junagadh voted in favour of accession to India; but no actual accession took place by the execution of any Instrument of Accession; (4) in December, 1948 the elected representatives of the people of Junagadh resolved that the Administration of the State be made over to the Government of Saurashtra and the representatives of Junagadh be enabled to participate in the Constituent Assembly of Saurashtra State; (5) a Supplementary Covenant (Appendix XXXVI of the White Paper) was executed by the Rulers of Kathiawar States with a: view to giving effect to the resolutions aforesaid; and (6) lastly, the administration of Junagadh was taken over by the Government of Saurashtra on January 20, 1949. 986 In M/s. Dalmia Dadri Cement Co., Ltd. vs The Commissioner of Income tax (1) this Court observed. .lm15 "In law, therefore, the process of acquisition of new territories is one continuous act of State terminating on the assumption of sovereign powers de jure over 'them by the new sovereign, and it is only thereafter that rights accrue to the residents of those territories as subjects of that sovereign. In other words under the dominion of a new sovereign, the right of citizenship commences when the act of. State terminates and the two therefore cannot co exist. " There may be cases where by a treaty or an agreement there is a change, over of de lure sovereignty at one and the same time and in such a circumstance the change over may not be a process, but that is not what happened in the case of Junagadh. The administration of Junagadh fell into chaos and disorder and the Government of. India stepped in at the request of the Nawab 's Council and took charge of the administration through an Administrator, on November 9, 1947, the Ruler having fled the country before that date. It is clear to us that there was no change over of de jure sovereignty on that date. Junagadh State still continued as such and did not cease to exist; otherwise there would be no meaning in the referendum held in February, 1948 or the resolutions passed in December, 1948, by the elected representatives of the people of Junagadh. Nor, would there be any meaning in the Supplementary Covenant executed by the Rulers of Kathiawar States. It is also worthy of note that there was no accession to India by the Junagadh State by the execution 'of any Instrument of Accession. We may in this connection refer to sections 5 and 6 of the Government of India Act, 1935, as they stood at the relevant time. Section stated inter alia that the Dominion of India shall, (1) [1959] section C. R. 729, 741. 987 as from the 15th day of August, 1947, be a Union, comprising (a) the, Governor is ' Provinces, (b) the; Chief Commissioners ' Provinces,(c) the Indian States acceding. to the, Dominion in the manner provided by section 6, and (d) any other areas that, may with the consent of the Dominion be included, in the Dominion. Junagadh was neither a Governor 's nor a Chief Commissioner 's Province. It did not accede in the manner laid down in section 6. It was not, therefore, a State acceding to, the Dominion. Nor do we think that the territory of, Junagadh State was included within the territory of the Dominion in the sense of el. (d) of section 5 as from November 9, 1917. The process of assumption of sovereignty was not yet complete and the Dominion of India did not treat the territory of Junagadh, as part of its own territory. The Dominion Government gave its concurrence to the Supplementary Covenant executed by the Rulers of Kathiawar by which the States of Junagadh, Manavadar, Mangrol, Bantwa, Babariawad and Sardargarh were to be integrated with Saurashtra. It is significant that in this Supplementary, Covenant Junagadh was mentioned as a separate State, the administration of which was to be integrated with the United State of Saurashtra. It was only when, this. integration took place that Junagadh ceased to be a separate State. This position appears to us to be beyond any doubt and has been made sufficiently clear by the statements made in, par&. 223 of the White Paper on Indian States. Learned Counsel for the respondents has relied on certain observations made in well known text books on International law and has contented that State sovereignty and. , State jurisdiction are complementary and co extensive; and a right of property and control exercised by the State is really a right of territorial severeignty and therefore the acquisition of territory by a State can mean nothing else than the acquisition of sovereignty over such territory. (See Sohwarzenberger: International , Vol. 1, page 79: Charles Cheney Hyde: International Law, 2nd revised edition, Vol. I, page 319; Oppenheim 's International Law, 8th Edn. I, page 545). He has contended that in view of the aforesaid observations, it must be, held that the Dominion of India assumed sovereignty over Junagadh on November 9, 1947; because, so learned counsel contends, exercising control over a parti cular territory is exercising sovereignty over it. We do not think that the observations to which learned counsel has referred help in the solution of the problem before us. In cases where the acquisition of new territory is a continuous process, a distinction must be made between de,facto exercise of control and de jure assumption of sovereignty. The problem before us is, as was stated in M/s. Dalmia Dadri Cement Co., Ltd. V. The Commissioner of Income tax (1), as to when the act of State was complete; in other words, when did the assumption of sovereign powers de jure, by the new sovereign over territories acquired by it take place? The problem is really one of State succession; namely succession to International Persons as understood in International law. Such a succession takes place when one or more International Persons take the place of another International Person in consequence of certain changes in the latter 's condition; there may be universal succession or partial succession. In the case before us, as long as Junagadh State ' continued as such, there was no such succession and even though the Dominion of India took over the administration of Junagadh and exercised control therein, it did not assume de jure sovereignty over it. Therefore, the act of State did not terminate till January 20, 1949, when the Dominion of India assumed de, jure sovereignty over Junagadh by its integration into the United State of Saurashtra. It is perhaps necessary here to refer to two decisions on which learned counsel for the (1) [1959] section C. R. 729, 741. 989 respondents has relied: In re: Southern Rhodesia(1) and Sammut vs Strickland (2). In the first decision it was observed in connection with the conquest of certain territories in Southern Rhodesia, that a proclamation of annexation is not essential to constitute the Crown owner of the territory as completely as any sovereign can be owner of lands publici juris; a manifestation of the Crown 's intention to that effect by Orders in Council dealing with the lands and their administration, is sufficient for the purpose. These observations were made in the context of a question not between State and State but between sovereign and subject. Lord Sumner said: " No doubt a Proclamation annexing a conquered territory is a well understood mode in which a conquering Power announces its will urbi et orbi. It has all the advantages (and the disadvantages) of publicity and precision. But it is only declaratory of a state of fact. In itself it is no more indispensable than is a declaration of war at the commencement of hostilities. As between State and State special authority may attach to this formal manner of announcing the exercise of sovereign rights, but the present question does not &rise between State and State. It is one between sovereign and subject. The Crown has not assented to any legislative act by which the declaration of its will has been restricted to one definite form or confined within particular limits of ceremonial or occasion. The Crown has not bound itself towards its subjects to determine its choice upon a conquest either out of hand or once and for all. If her 'Majesty Queen Victoria was pleased to exercise her rights, when Lobengula was defeated by her and her subjects, as to one part of the dominions in 1894 and as to another. part not until 1898, (1) (2) 990 if she was pleased to do so by Public acts of State which indicate the same election and confer the same supreme rights of disposition over his conquered realm as annexation would have done it is not for one of her subjects to challenge her policy or to dispute her, manner of giving effect to it. , We do not think that these observations help to establish the contention of learned counsel for the respondents that any exercise of administrative control in acquired territory must mean at once that there is an assumption of sovereignty ' by the incoming State so as to terminate the act of State. The observations made by Lord Sumner merely show that with regard to territory which the 'Crown has Conquered the Crown 's intention can be manifested in more than one way, and not necessarily by a proclamation. In the case before us a proclamation was issued by the Administrator, but that merely announced that he had assumed charge of the administration of Junagadh State under orders of the Government of India. It made no announcement as to assumption of sovereignty. In the second decision one of the questions raised was the true nature of the title of the Crown to the sovereignty of Malta, and a distinction was sought to be drawn between ceded territories those acquired by an act of cession from some sovereign power, and those ceded by the general consent or desire of the inhabitants. It was held that so far as concerned the prerogative right of the crown to legislate by Letters Patent or Orders in Council for the ' ceded colony, the distinction was of no materiality '. It is difficult to see how this decision affords any assistance to the respondents. It is indeed true that the people of Junagadh voted for accession to the Dominion of India , but no Accession actually took place and later there was a merger in ' the United State of Saurashtra with the consent of the people of, Junagadh and the Government of 991 India Till, such merger there was,, no "cession" of territory in the I sense either with or without the Consent of the people. In view, the only conclusions which follows from the facts which we have earlier stated is that there was no assumption of sovereignty by the Dominion of India over Junagadh before January 20, 1949. This disposes of the main argument advanced on, behalf of the respondents, and it is unnecessary in these appeals to consider the further argument to what rights the subjects of the ex sovereign in the acquired territory carried with them as against the new; sovereign. At one stage of his argument learned counsel for, the respondents commended for our acceptances the view of Chief Justice John Marshall in United States vs Percheman (1) that when 'the inhabitants of the acquired territory change their allegiance and their relation to the old sovereign is dissolved, their rights of property, remain undisturbed, and, he suggested that this view was consistent with modern usage of nations and was accepted by the Permanent Court of Inter. national Justice. (See the Advisory Opinion of the Permanent Court on the Settlers of German Origin in Territory ceded by Germany to Poland, Series B, No. 6, particularly pp. 35 36). He conceded, however that this Court has accepted the view expressed by the English Courts in Cook vs Sprigg(2) and the decisions which followed it. That view proceeds on the doctrine that acquisition of territory by conquest, cession or; annexation being an act of State ', municipal tribunals have no authority to give a remedy in respect of any actions arising therefrom (See M/s. Dalmia Dadri Cement Co., Ltd.,V. The Commissioner of Income tax(3) and State of Saurashtra vs Memon Haji Ismail Haji(4) Therefore learned counsel,was at great pains establish that the act of State was complete on November 9, 1947, (1) ; , 86 87. (2) (3) [1959] section C. R. 729, 741 (4) 7. 992 and he argued that thereafter the respondents be came citizens of the Dominion of India and under section 299 of the Government of India Act, 1935, they could not be deprived of property, save by authority of law. He relied on two decisions of this Court: Thacker vs State of Saurashtra (1) and Virendra Singh vs State of Uttar Pradesh (2). In view of our finding that the act of State did not terminate till the process of acquisition was complete on January 20, 1949, it becomes unnecessary to consider this second step in the argument of learned counsel. But per haps it is necessary to add that the decision in Virendra Singh vs State of Uttar Pradehe (2) was based on the special circumstances mentioned there in which led to the making of the Constitution of India. The learned Attorney General appearing for the appellant State has submitted that the principle of Virendra Singh 's case (2) cannot be extended to the entirely different set of circumstances in which the Government of India Act, 1935, was made and a. 299 thereof did not affect the doctrine that municipal tribunals have no authority to give a remedy in respect of actions arising from an act of State. He also drew our attention to a decision of this Court in Jagannath Agarwala vs The State of Orissa (a) in which in respect of some claims made against the State before the coming into force of the Constitution but enquired into and rejected by Government after the coming into force. of the Constitution, it was held that unless the now sovereign had expressly or impliedly admitted the claims, the municipal courts bad no jurisdiction in the matter. We consider it unnecessary to give our decision on these 'submissions, because it is obvious that before the Dominion of India assumed de jure sovereignty over Junagadh, the respondents were not in a position to call to their aid the provisions of section 299 of the Government of India Act, 1935. (1) A.I.R. 1954 S.C.680. (2) (3) ; 993 In the appeals before us we are dealing with orders made the Administrator before the act of ,State was complete. The action taken by the impugned orders &rose out of and during an act of State. That being the position, it is clear that the municipal, tribunals had no authority to give a remedy in respect of such action. It remains now to consider the last argument advanced on behalf of the respondents. As was observed in State of Saurashtra vs Memon Haji Ismail Haji (1) an act of State is an exercise of sovereign power against an alien and is neither intended nor purports to be legally founded. On behalf of the respondents it has been contended that the Administrator purported to cancel or :resume the grants under consideration in these appeals in pursuance of law; therefore, it was not open to the appellant State to take up the plea of an act of State. We 'do not think that there is any substance in this argument. Learned counsel for the respondents in Civil Appeal No. 349 of 1958 has drawn our attention to the pleadings, particularly to par&. 8 of the written statement filed on behalf of the appellant State. In that paragraph it was stated the order of resumption dated January 8, 1949 was legal and the Administrator had authority to resume such inam grant. On the basis of this paragraph 'it has been contended that inasmuch as the Administrator purported to act under authority of law it was not open to the appellant State to raise the plea of an act of State. In this connection we must also refer to para. 17 of the written statement where the appellant State specifically pleaded that the plaintiff respondent had no right to bring the suit against Government. In the trial court a specific issue was ;struck on the question as to whether the court had jurisdiction to hear and determine the suit. and under this issue the argument advanced was that the order of resumption was an act od State not justiciable in the municipal. courts. It appears, however, that the appellant State (1) [1960] 1 S.C.R.537. 994 also took a plea in the alternative that the order of resumption was justified under the rules in force in the Junagadh State. The trial, court, held that the order of resumption was not an act of State It further held that the order of resumption was not justified by the rules in: force in the Junagadh State. In these circumstances it cannot be said that the appellant State did not plead an act of State; nor can it be said that it was not open to the appellant State to raise, that plea ' , In the High Court also the same plea of: act of State was urged on behalf of the appellant State but was rejected by the High Court on the basis of its decision in State of Saurashtra vs Memon Haji Ismail Haji Valimamad(1). That decision, we have stated earlier, was overruled by this Court in State of Saurashtra vs, Memon Haji Ismail Haii Learned counsel for the respondents then, referred us to an order dated February 9, 1949, 'in which it was stated that inam grants were resumable at the pleasure of Government and therefore the orders passed on January, 8, 1949, could not be cancelled. Apparently the orders dated February. , 9, 1949 was passed on some representation made, at the instance of the plaintiffs respondents. We have to read the two orders, one dated January 8, 1949, and the other dated February 9, 1949, together. If so read, it is clear that the order dated January 8, 1949, was, made by the Administrator not under the authority of any law but as an act of State. Learned counsel for the respondents relied on the decision in Forester vs The Secretary. of State for India(3). In that case, the Privy Council, upon a construction of the treaty, or agreement made by the British. Government in August, 1805, with Begum Sumroo, held that the Begum was not a sovereign princess but a mere Jagirdar under obligation to keep up a body, of troops to be employed when called upon in, the (1) All. R. 1953 Saurashtra 180. (2) (1960) I section C. R. 537. (3) 995 service of the sovereign. On that finding it was held that the resumption of the lands by the British Government upon the death of the Begum was not an act of State but an act done under legal title. We do not think that the principle of that decision applies to the facts of these cases. In Vejesingji ji Joravarsingji vs Secretary of State for India (1) Lord Dunedin said that no plea specifically using the words " 'act of State" was required and the moment cession of territory was admitted. , the onus was on the plaintiffs respondents to prove that the right which they claim had been expressly or tacitly recognised by the new sovereign. If there was ,no such recognition and none was pleaded in these cases the municipal courts would have, no jurisdiction to give any relief. In this view of the matter it was not open to the courts below to enquire into the powers of the Nawab to resume or derogate from the grants made and whether similar powers were inherited by the Dominion Government or its agents. The action being an act of State was not ;justiciable in the municipal courts, even if the same were arbitrary. We have, therefore, come to the conclusion that the courts below were wrong in holding that the suits were maintainable and in enquiring into the merits of the cases. The appellant State is entitled to succeed on the plea that the orders of resumption made by the Administrator arose out of and during, an act of State and were not, therefore, justiciable in the municipal courts. We would accordingly allow these appeals and the suits will stand dismissed with costs throughout. There will be one hearing fee for the hearing in this court. MUDHOLKAR, J. We also agree that the appeals be allowed. but we wish to I say a few words. To appreciate the points which arise in these cases certain broad facts common to all appeals may well (1) (1924) L. R. 511 A. 357. 996 be stated. The respondents held certain properties in that part of the present State of Gujarat which was formerly the ruling State of Junagadh, by virtue of grants from its Ruler. After India attained independence on August 15, 1947, the suzerainty which the British Crown held over the State of Junagadh lapsed and that State became completely sovereign. That was the effect of the Indian Independence Act. Shortly thereafter, the Ruler of Junagadh went to Pakistan leaving the State to its fate, with the result that the affairs of that State fell into disorder. At the invitation of the people of the State the Government of India decided to step in and accordingly took over its administration through the Regional Commissioner, Western India and Gujarat States Region on November 9, 1917. A proclamation was issued by him to the effect that he had assumed the administration of Junagadh as from that date. On November 14, 1947, he appointed an Administrator for administering the territory. The Administrator passed orders on different dates resuming the grants in favour of the respondents and dispossessed them. Thereafter on January 20, 1949, the territory of Junagadh was with the approval of the Government of India integrated with the United States of Saurashtra and the Administrator ceased to exercise any functions as from that date. The resumption of the grants and the validity of their dispossession were challenged by the respondents by instituting, suits for possession of the property after the integration of Junagadh with the United State of Saurashtra upon the ground that they could not be deprived of their properties by executive action. According to them the act of the Dominion of India in taking over the administration of Junagadh territory on November 9, 1947, amounts to assumption of sovereignty over it, that ' thereby its residents became citizens of the Dominion of India as from that date and, therefore, no not of state 997 such as resumption of their properties could be committed against them by the Indian Dominion. According to the appellants no municipal court could grant the relief claimed by the respondents because the act complained of was an act of state. The plea of the respondents was accepted by the High Court of Saurashtra following the decision in the State of Saurashtra vs Memon Haji Ismail Haji Valimamd(1). The present appeals are, from its judgment. The Attorney General who appeared for the appellants stated that this Court has reversed that decision in State of Saurashtra vs Memon Haji Ismail Haji (2) and that, therefore, these appeals should be allowed. In that case this Court held that the Indian Dominion merely assumed the administration of Junagadh State on November 9, 1947 at the request of the Ruler 's Council but did not formally annex it till January 20, 1949. Mr. Pathak 's contention is that as the respondents were not parties to the decision in Memon Haji 's case (2) they are not bound by the finding of this Court that the Junagadh State was annexed by the Indian Dominion on January 20, 1949. It seems to us, however, that the question whether Junagadh was annexed on January 20, 1949, or. earlier would make little, difference to the result of the appeals before us. Nor again would the question whether the, I Extra Provincial Jurisdiction Act was applicable to the orders made by the Administrator and this was a display of sovereignty, as contended for by Mr. Pathak, would make any difference. In along catena of cases beginning from Cook vs Spriggs (3) and going upto Asrar Ahmed vs Durgah Committee, Ajmer(4) the Privy Council has stated the legal position of the subject of a displaced sovereign vis a vis the now sovereign. In the words (1) A. I. R. 1953 Saurashtra 180. (2) ; (3) (4) A. I. R. 1947 P.C I. 998 of Lord Dunedin in Vajesinghji vs Secretary of State for India(1), it is as follows When a territory is acquired by,& 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 municipal courts established by the new sovereign only such rights as that sovereign has, through his officers, recognized. Such rights as he had tinder 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. " This statement of the law has ' been accepted by this Court in M/s. Dalmia Dadri Cement Co., Ltd. vs Commissioner of Income tax (2) upon which ;reliance has been placed in State of Saurashtra V. Memon Haji Ismail Haji (3) and recently also in Jagannath Aggarwala vs The State of Orissa (4). Thus even if on the respondents ' own showing that the Junagadh territory must be deemed to have been annexed by the Indian Dominion by assuming administration over it and thereupon its residents became citizens of India, they could assert and establish in the municipal courts of the new sovereign only such rights as were recognized by the. Indian Dominion. The respondents claim to be grantees from the Ruler of Junagadh but their grants avail them nothing in the courts of the now sovereign unless they were recognized by that sovereign. The burden of showing that they were so recognized lay on the respondents. (1) (1921) L.R. 51 I. A. 357. (2) (3) ; (4) ; 999 A perusal of the orders passed by the administrator would clearly show that, far from recognizing those grants 'they Were in effect repudiated by him. The administrator in fact resumed the grants but whatever the form his orders took in truth and in substance they were no" more than a clear arid unequivocal declaration of the fact that the right ' claimed by the respondents to the 'properties in question by virtue of the grants made in their favour by the former Ruler. were not, recognized by the new sovereign. Recognition or refusal of recognition of rights of erstwhile aliens who had no legal enforceable , rights cannot be said to be an act of state because in the Indian Dominion other had already vested in the Indian Dominion at the moment it occupied Junagadh territory The right to retain Possession was also dependent, upon recognition by the Dominion of India and by dispossessing the respondents the former exercised its choice and refused to recognise their rights. On the principle accepted by this Court in the decisions already referred to, the res pondents "were disentitled from obtaining any redress from 'a court in the Indian Dominion, and after the commit into force 'of the constitution, from a court in the union of India, in the absence of recognition of their rights by it or by the Union of India. We may now ' advert to another point, urged by Mr. Pathak, According to him, if we understood him correctly, the Extra Provincial Jurisdiction Act was applied to Junagadh, that thereunder the local laws prevailing therein were continued and that the Alienation Settlement Act which was one of such laws, conferred on the granted of rights against the Ruler. By continuing this law the Dominion of India, accordant, to him,. must be deemed to have recognized the respondents rights under the grants. For enabling us to consider, the point it was necessary for the respondents to place before us the Order of the Dominion of India under 1000 section 4 of the Extra Provincial Jurisdiction Act, 1947 Which alone empowered it to prescribe the laws which of the Indian Dominion, over which it had assumed sovereignty or administrative control. Similarly they had to place the Alienation Settlement Act of Jungadh before us. the absence of this material we cannot consider the argument at all. Mr. Pathak, however contended that if sovereignty was assumed on November 9, 1947, the residents of Junagadh became the citizens of the Indian Dominion and were therefore, entitled for the protection of section 299(1) of the constitution Act, 1935. ` This provision runs thus: "No person shall be deprived of his property save by authority of law". What section 299(1) protects are the rights of a person to property which he had when section 299(1) cases into force or applied to him. It does not add to any property right of any person, though it contains an admonition to the State against deprive in any person of his property by mere executive action. For ascertaining whether the provision has been violated we must first examine the existance and the nature of.the rights possessed by the respondents on November 9, 1947, that is, at the moment of assumption of administration by the Dominion of India over Junagadh territory assuming of,courge that this amounted to assump tion of sovereignty over Junagadh). Their rights were as grantees from the former ruler and although it thay be that according to the principles of international law their rights as grantees ought not to be affected, no municipal court has their right to enforce the obligation of the new sovereign to respect them. For, as oitited out by Venkatarama Iyer J., who delivered he judgment of this Court in Dalmia Dadri Cement Co., Ltd. vs Commissioner of Income tax(1): (1) [1959] S.C.R. 729, 741. 1001 "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 One of the decisions relied on by this Court in that case is that of the Privy Council in Secretary of State for India vs Bai Rajbai(1) in which they have observed "The relation in which they stood to their native sovereign before this cession and the legal rights they enjoyed under them, are, save in one respect, entirely irrelevant matters. They could not carry on under the new regime the legal rights, 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 express or implied, or by legislation, chose to confer upon them." Thus, 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, 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 a. 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 (1) (1915) L. R: 42 I.A. 229.

The Nawab of junagadh State made grants of properties in favour of the respondents before 1947. After India attained independence the Nawab fled the country. At the request of the Nawab 's Council the Government of India took over the administration of the State and on November 9, 1947 the Regional Commissioner assumed charge of the administration on behalf of the Government of India. The Regional Commis sioner appointed an Administrator of junagadh State. In December 1948, the elected representatives of Junagadh and certain other neighbouring States recommended to the Govern ment of India and to the United State that of Saurashtra that the States be integrated. Thereafter, the administration of junagadh State was integrated with the United State of Saurashtra on January 20, 1949. On different dates between November 9, 1947, and january 20, 1949, the Administrator passed orders cancelling the grants in favour of the respondents and took possession of the properties. The respondents filed civil suits for the recovery of the properties on the ground that 971 they had been taken away without the authority of law. The appellant contended that the orders made by the Administrator arose out of and during an act of State and were not justiciable in the municipal courts. The respondent contended that the ,question as to when the change over of sovereignty took place was a political question which should be referred to the Government of India for its Opinion and the Court should abide by that opinion and that the facts of this case showed that there was complete change over of sovereignty on November 9, 1947, and the act of State was complete. I Held, (per C. J., Das and Ayyangar, jj.) that the impug ned orders arose out of and during an act of State and they could not be questioned before municipal tribunals. There was no change over of de jure sovereignty on November 9,1947 when the administration was taken over and junagadh continued to exist as such even after this date. junagadh was not a State which acceded to the Dominion nor was its territory included within the territory of the Dominion as from November 9, 1947. It was only on January 20, 1949, that the Dominion of India assumed de jure sovereignty over junagadh by its integration into the United State of Saurashtra and the act of State came to an end. It was not necessary to seek information from the Government of India as to the date of the change over as there was no uncertainty about it and also as the Government of India had spoken with sufficient clarity in the White Paper on Indian States. State of Saurashtra vs Memon Haji Ismail Haji, ; and M/s. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of lncome tax, (1959) S.C.R. 729, followed. In re: Southern Rhodesia, and Samaut vs Strickland , referred to. Per Sarkar and Mudholkar JJ. Even if it be accepted that junagadh was annexed on November 9, 1947, and the respondents became citizens of India they could assert and establish, in the municipal courts of the new sovereign only such rights as were recognised by the Indian Dominion. The burden of showing that they were so recognised lay on the respondents. The orders passed by the Administrator show that far from recognizing the grants in favour of the respondents they were repudiated. The respondents could not claims the benefit of section 299 (1) of the Government of India Act; 1935, as they had to establish that on or after November 9, 1947, they possessed legally enforceable right against the Dominion of India, which they could only do by showing that their pre existing rights had been recognized by the Dominion of India; s.299(1) did rut enlarge any rights to property but only protected those which a person already had. 972 M/s Dalmia Dadri Cement Co., Ltd. vs The Gommissioner of Income tax, (1959) S.C.R. 729, In Re,. Southern Rhodesia, Samaut vs Strickland, , United States vs Percheman, ; , Cook vs Sprigg, , Phacker vs State of Saurashtra, A.I.R. 1954 S.C. 680 and Virendra Singh vs State of Uttar Pradesh, ;

Civil Appeal No. 282 of 1960. Appeal from the judgment and order dated February 15, 1956, of the Madras High Court in Writ Petition No. 404 of 1952. K. N. Rajagopala Sastri and P. D. Menon, for the appellant. R. Gopalakrishnan, for the respondent. October 20. The Judgment of the Court was delivered by HIDAYATULLAH, J. Whether the legal representative of a deceased person, who is assessed in respect of the total income of the latter person, as if he were the assessee, can be ordered to pay a penalty under section 46(1) of the India Income tax Act, is the short question that arises in this appeal. One Ebenezer died intestate on November, 22, 1945, during his year of account which ended on March 31, 1946. He left behind him the respondent, E. Alfred, his son, and eight daughters. For the assessment year, 1946 47, the respondent was assessed under section 24B(2) of the Income tax Act, after a notice was issued to him under s.22(2), ibid. The assessment was completed on March 26, 1951, and a notice of demand was issued under section 29 of the Act. The respondent appealed against the order of assessment to the Appellate Assistant Commissioner, but during the pendency of the appeal, a penalty of Rs. 250/ was imposed upon 145 him under s 46(1) of the Act by the Income tax officer, as he had defaulted in payment of tax on the due date. After the appeal was disposed of with very minor modifications, a notice of demand was again issued to him to pay the tax on or before December 15, 1951. On his default, a second penalty of Rs. 10,000/ was imposed upon him on March 8, 1952. The respondent then filed a petition under article 226 of the Constitution in the High Court of Madras challenging the imposition and levy of penalty imposed upon him. The High Court held in his favour, and quashed the, two orders imposing penalty but granted a certificate of fitness to appeal to this Court. This appeal was then filed. In reaching the conclusion that section 46(1) of the Act did not apply to a legal representative, the learned Judges of the High Court held that a legal representative could not be said to be included within the words of that section. "when an assessee is in default in making a payment of Income tax" because of the scheme of the Act, particularly B. 29, where a distinction is made between "an assessee" and "other person". According to the learned Judges, a legal representative is assessed as an assessee under a fiction in section 24B(2), and that fiction comes to an end when the computation of the tax Or, in other words, the assessment is made. The learned Judges drew distinction between the three subsections of 8. 24B, and pointed out that sub section (1) only created a liability on the legal representative for collection of tax but did not refer to him for that purpose as an assessee and sub s.(3) which did not concern itself with collection, did not refer to the legal representative as an assessee, and held that the fiction in sub section (2) was created for the limited purpose of assessment, and since that subsection also did not concern itself with collection, the fiction could not be carried beyond assessment resulting in the determination of the tax. 146 Thereafter, according to the High Court, the legal representative is not an assessee within the meaning of section 29, but can only be brought under tho words "other person", and inasmuch as sections 45 and 46 refer to "an assessee in default", the legal 3. representative cannot be treated as such and no penalty can either be imposed upon him or recovered. We are concerned with the definition of "assessee" before its amendment in 1953. That definition read as follows: "assessee" means a person by whom income tax is payable" The generality of this definition is sufficient to include even a legal representative who is to pay the tax, though out of the assets of the deceased person. Section 24B, which makes it legal representative liable, is as follows: 24B. (1) Where a person dies, his executor, administrator, or other legal representative shall be liable to pay out of the estate of the deceased person to the extent to which the estate is capable of meeting the charge the tax assessed as payable by such person, or any tax which would have been payable by him under this Act if he had not died. (2) where a person dies before the publication of the notice referred to in subsection (1) of section 22 or before he is served with a notice under sub section (2) of section 22 or section 34, as the case may be, his executor, administrator or other legal representative shall, on the serving of the notice under subsection (2) of section 22 or under section 34, as the case may be comply therewith, and the Income tax officer may proceed to assess the total income of the deceased person as if such executor, administrator or other legal representative were the assessee. 147 (3) where a person dies, without having furnished a return which he has been required to furnish under the provisions of section 22, or having furnished a return which the income tax officer has reason to believe to be incorrect, or incomplete, the Income tax officer may make an assessment of the total income of such person and determine the tax payable by him on the basis of such assessment and for this purpose may, by the issue, of the appropriate notice which would have had to be served upon the deceased person had he survived, require from the executor, administrator or other legal representative of the deceased person any accounts, documents or other evidence which he might under the provisions of sections 22 and 23 have required from the deceased person". The scheme of the section, which was inserted by the Second Amendment Act of 1933 and modified further by the Amendment Act of 1939 is as follows: Subsection (1) of a 24B makes, inter alia the legal representative liable to pay out of the estate of deceased person to the extent to which the estate is capable of meeting the charge, the tax assessed as payable by such person or any tax which would have been payable by him under the Act, if he had not died. By this sub section, a legal representative is made liable to pay the tax which might have been assessed but not paid by the deceased person or which might be assessed after his death. It covers all situations and contingencies and makes the liability absolute, limited, however, to the extent to which the estate of the deceased is capable of meeting the charge. The subsection does not provide for issue of notices, assessment collection or anything connected with the imposition, levy and collection of the tax, Subsection (2) and (3) next provide for different contingencies. Subsection (2) provides that where a person dies 148 before the publication of a general notice or before he is served with a special notice under s.22 or s.34 his legal representative shall, on the service of the special notices comply with these notices, and the Income tax officer may proceed to assess the total income of the deceased person as if the legal representative were the assessee. Sub section (3) provides that where a person dies after he has been required to furnish a return but without having furnished such return, or where he has furnished the return but the Income tax officer has reason to believe it to be incorrect, the Income tax officer may make the assessment of the total income of such deceased person, and determine, the tax after serving such notices, as may be required under s.22 or 23, upon the legal representative of the deceased person to produce the accounts, documents or other evidence. In the present case, the matter fell to be governed by the second sub section, because Ebenezer died before the end of his year of account. The service of the notice upon the respondent and his assessment, as if he were the assessee, were made under the second sub section. By reason of this assessment, the respondent became liable under the first sub section to pay out of the estate of Ebenezer the tax assessed, to the extent to which Ebenezer 's estate was capable of meeting the charge but he himself was deemed to be the assessee. No doubt, the fiction made the respondent an assessee for the purpose of assessing the total income of Ebenezer. But the question is whether the fiction came to an end after the assessment, so that he remained a mere debtor thereafter to the Department. The answer to this question would determine the further application of the other sections of the Act. When a thing is deemed to be something else it is to be treated as if it is that thing, though, in fact, it is not. The original assessee being dead before the notice, either general or 149 special, to him, he could not be treated as all assessee, and the process of the Act is, by the fiction made available against a different person like a legal representative, who is fictionally deemed to be an assessee for purposes of assessment. The word "assessment" bears different meanings, and in one sense, it comprehends the entire process of computation and levy of the tax. It is in this sense that the legal representative becomes an assessee by the fiction, and it is this fiction which has to be fully worked out, without allowing the mind "to boggle" as was said in Commissioner of Income Tax vs Teja Singh(1) applying the dictum of Lord Asquith in East End Dwellings Co., Ltd. vs Finsbury Borough Council(2). If we turn to the definition of "assessee", it says that an assessee means a person by whom income tax is payable. A legal representative who by fiction, is decreed to be an assessee therefore, comes within this definition, because he is a person by whom income tax is payable, though out of the assets left by a deceased person. The assessment of the legal representative is then made under section 23 of the Act, and he has the right to appeal under B. 30, which he would not have, if he ceased to be an assessee after the determination of the tax. We are not concerned in this case with the position of the legal representative under the third sub section of s.24 B, and are not required to consider what his position would be, if he made a default in the payment of the tax. The fiction is enacted at least for the purpose of sub section (2), and it is to that subsection that we are confined in this case. Nor can the fiction in that sub section be limited by provisions of law for a totally different situation. Under s.45, if a notice of demand is issued under s.29 on an assessee and has not been complied with the assessee is deemed to be in default, and under section 46 (1), if the assessee is in default, a penalty, can be imposed. All these stages the respondent (1) (1959) Supp. 1 S.C.R. 394. (2) , 132. 150 went through in this case. He was himself an assessee qua the assets and liability to tax, of Ebenezer he was, therefore, an assessee in default and liable to the imposition of penalty for this default. The question is whether s.29, which makes a distinction between an assessee and "other person", makes any difference. The High Court as well as the learned counsel for the respondent (who pressed upon us the reasons of the High Court) referred to the words of s.29 where in addition to an "assessee" liable to pay the tax occur the words "other person" liable to pay such tax, and observed that the respondent would fall to be governed by the words "other person" liable to pay such tax and not by the words "the assessee" liable to pay such tax. The High Court reasoned, therefore, that the words "an assessee" in sections 45 and 46 in their application are limited to an assessee, who is assessed on his own behalf and not "other person", who is not an assessee. This distinction, it observed, must be borne in mind in interpreting the word "assessee" used in sections 45 and 46, and so construing, limited the word "assessee" in those two sections to an assessee proper. The words "other Person" cannot apply to a legal representative, if he is an assessee by fiction, and the section has to be worked out to its logical conclusion. If he falls within the word "assessee ', as has been shown above, he does not fall within the words "other person" and it is not necessary to find in this case what persons are there meant to be included. In our opinion, the penalty could be imposed on respondent as an assessee. The appeal thus succeeds, and is allowed with costs here and in the High Court. Appeal allowed.

One died intestate during his year of account Leaving g behind him his son A the respondent and eight daughters. After notice under section 22 (2) of the Income Tax Act was issued, A was assessed under section 24 (2) of the Act and notice of demand was issued under section 29. The respondent appealed to the Appellate Assistant Commissioner, but during the pendency of the appeal a penalty was imposed upon him under section 46 (1) of the Act by the Income tax officer as the respondent had defaulted in payment of tax on the due date. After the appeal was disposed of a notice of demand was again issued to the respondent to pay the tax. On respondent 's default, a second penalty was imposed upon him. Respondent challenged this order by writ. The High Court quashed the order inter alia holding that section 46 (1) did not apply to a legal representative as he was assessed as an assessee under a fiction in section 24B (2) and that fiction came to an end when the assessment was made, for the fiction was created for the limited purpose of assessment, and since that subsection was not concerned with collection, the fiction could not be carried, beyond assessment resulting in the determination of tax. The question was whether the fiction came to an end after the assessment, so that the Legal representative remained a mere debtor to the department or could he be ordered to pay penalty under section 46 (1) of the Act. ^ Held, that the fiction made the respondent an assessee for the purpose of assessing the total income of E. That fiction did not come to an end after the assessment. When a thing is deemed to be something else, it is to be treated as if it is that thing, though, in fact it is not E being dead before the notice, either general or special, to his, could not be treated as an assessee, and the process of the Act, was, by fiction, made available against the legal representative who was the assessee for purpose of assessment which meant the entire process of computation and law of the tax and the fiction had to be worked out to its logical conclusion. The definition of 144 the word assessee being defined in the Act as a person by whom income tax is payable, the legal representative came within the definition and his assessment being made under section 23, he had also a right of appeal under section 30 since he did not cease to be an assessee after the determination of the tax at least for the purpose of sub section (2) of section 24 B, and section 29 applied to the legal representative in his position as the assessee. Commissioner of Income tax vs Teja Singh, [1959] Supp. 1 S.C.R. 394 and East End Dwellings Co. Ltd. vs Finsbury Borough Council,[1952] A.C. 109, referred to.

Civil Appeal No. 60 of 1961. 2 Appeal from the judgment and order dated September 15, 1958, of the Mysore High Court at Bangalore in Writ Petition No. 144 of 1957. K. N. Rajagopal Sastri and P. D. Menon, for for the appellant. Rameshwar Nath, section N. Andley and P. L. Vohra, for the respondent. October 5. The Judgment of the Court was delivered by KAPUR, J. This is an appeal on a certificate of the High Court under article 133 (1)(c) of the Constitution against the judgment and order of the High Court of Mysore passed in a petition under article 226 of the Constitution of India. The appellant before us is the 1st Additional Income tax officer and the respondent is the assessee, and the matter relates to the assessment year 1948 49 the accounting year being 1947 48. The facts of this appeal are as follows. On November 27, 1956, a notice was issued to the respondent under B. 34 (1)(a) of the Indian Income tax Act calling upon him to make a return on the ground that his income had escaped assessment for the assessment year ending 31st March, 1949. This notice was served on the respondent on November 29, 1956. The respondent objected that no notice under B. 34 of the Income tax Act could be issued to him because of the lapse of eight years from the end of the accounting year. This objection was overruled and the respondent filed on June 12, 1957, in the High Court of Mysore, a petition under article 226 of the Constitution for a writ of certiorari quashing the order made by the Income tax officer. The High Court held on a construction of s 34 of the India Income tax Act, that the words 'any year" as used in section 31(1)(a) mean not the assessment year but the accounting year. It is that question which is required to be decided in this appeal. Section 34(1 )(a) reads: 3 section 34(1) "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 of his income under section 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year income, profits or gains chargeable to income tax have escaped assessment for that year, or have been under assessed, or assessed at too low a date, or have been made the subject of excessive relief under the Act, or excessive loss or depreciation allowance has been computed, or (b) . . . . . . he may in cases falling under clause (a) at any time within eight years serve on the assessee, or if the assessee is a company on the principal officer thereof, a notice containing all or any of the requirement 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; and the provisions of this Act shall, so for as may be, apply accordingly as if the notice were a notice issued under that sub section;". The argument is that the words "any year" in cl.(a) refer to the assessment year because under the Income tax Act the income of the previous year is assessed for the assessment year. For this purpose reference was made to some of the other provisions of the Income tax Act. In section 3 of that Act, which is the charging section, it is provided: section 3 "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 charged for that year in accordance with, and subject to the provisions 4 of, this Act in respect of (the total income) of the previous year of every (individual, Hindu undivided family, (company and other local authority, and of every firm and other ar association of persons or the partners of the firm or the members of the association individually)` ' . This shows that income tax is charged for "any year" at the rate or rates set out in a Central Act and the reference is to the Indian Finance Act in this case to that of 1948, (Act XX of 1948): Section 9 of that Act reads as follows: section 9(1) "Subject to the provisions of sub sections (3),(4), (5) and (6), for the year beginning on the 1st day of April, 1948, (a) income tax shall be charged at the rates specified in Part I of the Second Schedule to this Act, and (b). . . . . . (2) In making any assessment for the year ending on the 31st day of March, 1949,. . . (3) In making any assessment for the year ending on the 31st day of March, 1949, (a) . . . . . (b) . . . . . It is quite clear from this section that according in to the Finance Act 1948, the income tax was to be charged at the rates specified in the Schedule attached thereto for the year beginning on the 1st day of April, 1918, and the assessment was for the year ending on March 31, 1949 under sub sections (2) and (3). Thus according to the Indian Finance Act assessment was to be made for the year ending March 31, 1949 at rates specified for the year beginning April 1, 1948. Coming now to 8. 22(1) it is there (1) provided that section 22(1) "The Income tax officer 5 shall, can or before the 1st day of May in each year give notice by publication in the press and publication in the prescribed manner, requiring every person whose total income during the previous year exceeded the maximum amount which is not chargeable to income tax to furnish, within such period less than sixty days as may be specified in the notice, a return, in the prescribed manner, setting forth (along with such other particulars as may be required by the notice) his total income and total world income during that year: . . " It shows, therefore, that a return has to be made for the year of assessment in regard to the total income during the previous year which is the accounting year; in other words income tax is assessed for the assessment year on total income of the previous year. When under section 34 (1) (a) a return is required the return has to be made under section 22 for any year, and when the reference is to omission to make a return of the income under section 22 for any year, the year is the assessment year, although the income which is declared relates to the previous year. The reference in cl. (a) of sub section (1) to B. 22 of the Act therefore makes the meaning of the phrase for any year" referable to an assessment year. The clause makes it clear that an assessee can be called upon to make a full and true disclosure of all materials necessary for his assessment of that year which necessarily must mean an assessment year and it is, in our opinion, erroneous to say that a return under section 22 of the assessees income for any year would have a different meaning in the first part from that dealing with the full and true disclosure of all material facts necessary for the assessment for that year. With due respect to the learned Judges of the High Court who gave the decision, the view 6 taken by them as to the meaning of "any year" was erroneous, and the correct way of interpreting section 34 (1) (a) is that the words "for any year" mean for any assessment year and not for any accounting year because as we have said above, the assessment is for the assessment year although of the income which accrued in the previous year. It may be added that the previous year for different heads of income falling under different sections of the Indian Income tax Act may vary and it could not have been the intention of the Legislature to give different starting points of limitation for different sources of income. Reading the various sections of the Indian Income Tax Act, which are set out above and the provisions of Indian Finance Act 1948, it is clear that the words "that year." in section 31(1) (a) have reference to the assessment year and not the accounting year. Our attention was drawn to a, judgment of this court in Pannalal Nandlal Bhandari vs Commissioner of Income tax, Bombay City(1). In that case it was held that once a notice is given in the prescribed manner under section '22 (1) of the Income tax Act every person whose income exceeds the maximum amount, exempt from tax, is obliged to submit a return, and, if he does not do so it will be deemed that there was an omission on his part within section 34 (1) (a). The question now debated was not raised there but it was observed that the notices had been issued within eight years from the end of the years of assessment and if cl. (1) (a) of section 34 was applied the assessment was not barred by the law of Limitation. It was also observed at page 79 that "the appellant not having submitted a return in pursuance of the notice issued under section 22 (1 ) the Income tax officer was competent under section 34 (1) (a) to issue notice at any time within eight years of the end of the year of assessment for assessing him to tax". (1)[1961] 2 section C. R. 35. 7 The appellant also relied upon C.W. Spencer vs Income tax officer, Madras(1). It was there observed: The period of limitation, whether it is eight years for cases falling under section 34 (1) (a) or four years falling under section 34 (1) (b), has to be computed from the end of that year. Though the expression "year" has not been further defined by section 34 itself, it should be clear from the context to the section itself that the year referred to is the assessment year and has no reference to the accounting year, which is elsewhere specified by the Act itself as the previous year. " In our opinion therefore, the view taken by the Madras High Court in C. W. Spencer 's (1) case is the correct view and the view taken by the learned judges of the Mysore High Court is erroneous. We therefore allow this appeal, set aside the judgment and order of the High Court by which the proceedings taken against the respondent were quashed. The respondent will pay the costs of the appeal in this court and in the High Court.

In 1956 a notice was issued to the respondent under section 34(1)(a) of the Indian Income tax Act, calling upon him to make a return on the ground that his income had escaped assessment for the year ending 31st March, 1949 The respondent contended that notice under section 34 of the Act could not be issued to him because of the lapse of eight years from the end of the accounting year. This contention was not accepted by the Income Tax officer. The assessee then filed an application under article 226 of the Constitution. The High Court held on a construction of section 34 of the Act, that the words 'any year ' as used in section 34(1)(a) mean. not the assessment year but the accounting year. The Income tax officer appealed The contention was that the words 'any year ' in cl. (a) refer to the assessment year. ^ Held, that the correct way of interpreting section 34(1)(a) of the Indian Income tax Act, 1922, read with the provisions of the Indian Finance Act, 1948, is that the words 'for any year ' mean for any assessment year and not for any accounting year because the assessment is for the assessment year although of the income which accrued in the previous year (year of account) The Previous year for different heads of income falling under different sections of the Indian Income tax Act may vary but does not give different starting points of limitation for different sources of income. Panna Lal Nand Lal Bhandari vs Commmissioner of Income Tax, Bombay City, ; , referred to. C. W. Spencer vs Income tax officer, Madras, , approved.

Civil Appeal No. 494 of 1960. Appeal by special leave from the judgment and under dated April 21, 1958 of the Orissa, High Court in O.J.C. No. 107 of 1954. G. C. Mathur, for the appellants. H. N. Sanyal, Additional Solicitor General of India, R. N. Rajagopal Sastri, G. K. Mishra and T. M. Sen, for the respondents. October 26. The Judgment of the Court was delivered by SHAH, J. Messrs. Buarmah Construction Company a firm carrying on business as building and works contractors executed several contracts in the State of Orissa for construction of buildings roads, bridges etc. Messrs. Burmah Construction Company, who are hereinafter referred to as the appellants, were registered as dealer in Orissa under the Orissa Sales Tax Act, 1947 from the quarters ending June 30, 1949. The Sales Tax officers treating the transfer of the materials used in the construction of the buildings, roads and bridges, as sale of goods, assessed the appellants to tax under the Orissa Sales Tax Act. The tax so assessed under the diverse orders of assessment was paid from time to time. For the quarters ending June 30, 1949, to March 31, 1954, the appellant paid Rs. 1,17,869 80 as tax and Rs. 2,917 11 0 as penalty. The following table sets out the tax and penalty paid to the Sales Tax Authorities for the twenty quarters: Srl. Circle Regist Tax Penalty Total No. Name. ration paid. amount No paid Rs. A.P.Rs. A.P. Rs. A.P. 1. PU II 1755 35636 7 0 350 00 35686 70 53990 6 6 310 00 54300 66 244 2719 30 . 2719 30 4. MB 806 3376 60 1352 40 4728 100 5 BP 1560 5349 10 . . .5349 10 6. CU III 1375 10913 120 905 70 11819 30 7. CU I 3940 6184 60 . 6184 60 1178869 86 2917 110 120787 36 Relying upon the judgment, of the Madras High Court in Gannon Dunkerly & Co. Ltd . vs State of Madras(1), the appellant applied on August 9, 1954, to the High Court of Judicature, Orissa for (a) a declaration that the provision of the Orissa Sales Tax Act, 1947 authorising imposition of the sales tax on a turnover of works contracts and repair works were ultra vires the State Legislature; (b) a declaration that the assessment made by the State Sales Tax Authorities on the appellant 's works contracts which had resulted in payment of Rs. 1,20,787 3 6 by was of sales tax and penalties for different quarters were without jurisdiction and illegal and liable to be quashed and that the appellant was entitled to get refund of the said amount; (c) a direction restraining the State and its Sales Tax officers from taking any steps in making any further assessment or complete the assessments pending before them in respect of the appellant 's works contracts with the State Government and levying and collecting any sales tax from the appellant on works contracts; and (d) issue of appropriate writ or directions direting the State of Orissa and its Sales Tax Officers to refund the amount of sales tax and penalties realised from the appellant. (1)A.I.R. (1954)Mad.1130 245 Following the judgment of this Court in the State of Madras vs Gannon Dunkerly &, Co., Ltd.(1) which confirmed the decision of the Madras High Court in 5 S.T.C. 216, the High Court declared that the assessment of sales tax was not in accordance with law and directed that no steps, either by certificate proceedings or otherwise should be taken to realise the arrears of sales tax in respect of those contracts. The High Court also directed refund of tax paid, if recovery thereof was not barred under 8.14 of the Orissa Sales Tax Act 1947 on the date of the filing of the application. The High Court also directed the Sales Tax; Authorities to revise the assessments made in the light of the decision of this Court in respect of assessments made after the date of the petition. The appellants have appealed to this Court with special leave challenging the order in so far as their claim for refund is partially declared to be barred by the rule of limitation prescribed by ff. 14 of the Orissa Sales Tax Act. The appellants challenge the correctness of the Order declaring that the portion of the tax paid refund whereof is beyond the period of limitation under B. 14 of the. Orissa Sales Tax Act, 1947 on the date of the filing of the application under article 226, as not refundable on two grounds: (1) that section 14 of the Act is ultra vires the State Legislature; (2) that an application under B. 14 which imposes a statutory obligation upon the Collector to refund the tax unlawfully recovered subject to certain conditions is not the only remedy open to the tax payer from whom tax has been unlawfully recovered and the power of the High Court to direct refund of tax illegally recovered is not restricted by section 14 of the Act. To the enforcement of other remedies the bar prescribed by the proviso to section 14 does not apply. [1959] S.C.R. 246 Section 14 of the Orissa Sales Tax Act, 1947, provides: "14. The Collector shall, in the prescribed manner, refund to a dealer applying in this behalf any amount of tax paid by such dealer in excess of the amount from him under this Act, either by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of any other period: Provided that no claim to refund of any tax paid under this Act shall be allowed unless it is made within twenty four months from the date on which the order of assessment was passed or within twelve months of the final order passed on appeal, revision, review or reference in respect of the order of assessment, whichever period is later. " By the first paragraph, 8. 14 imposes an obligation upon the Collector to refund to a dealer any amount paid by such dealer in excess of the amount due from him under the Act. But the obligation is restricted; refund is not to be made unless an application is made within 24 months of the date on which the order of assessment was passed or within 12 months of the final order passed on appeal, revision, review or reference in respect of the order of assessment, whichever period is later. 'the orissa Sales Tax Act was enacted by the Orissa legislature in exercise of the Legislative authority conferred upon it by item 48 of List II of the Seventh Schedule of the Government of India Act, 1935. in dealing with the vires of 8. 14A of the orissa Sales Tax Act, which was incorporated in the amended Act 28 of 1958 and which sought to confer a right to claim refund by an application to the collector upon the person from whom tax was collected by the dealer, this Court observed in The State of Orissa vs The Orient Paper Mills Ltd" that 'The power to legislate with respect to a tax. 247 comprehends the power to impose the tax, to prescribe machinery for collecting the tax, to designate the officers by whom the liability may be enforced and to prescribe the authority, obligations and indemnity of those officers. The diverse heads of legislation in the Schedule to the constitution demarcate the periphery of legislative competence and include all matters which are ancillary or subsidiary to the primary head. The Legislature of the Orissa State was therefore competent to exercise power in respect of the subsidiary or ancillary matters of granting refund of tax improperly or illegally collected '. If the power to legislate in respect of tax comprehends the power to legislate in respect of refund of tax improperly or illegally collected, imposition of restrictions on the exercise of the right to claim refund will not be beyond the competence of the Legislature. Granting refund of tax improperly or illegally collected and the restriction on the exercise of that right are both ancillary or subsidiary matters relating to the primary head of tax on sale of goods. The provisions of s.14 of the Act are therefore not ultra vires the State Legislature. It is not necessary to consider in this case whether section 14 prescribes the only remedy for refund of tax unlawfully collected by the State. The appellants have not filed any civil suit for a decree for refund of tax unlawfully collected from them. This appeal arises out of a proceeding filed in the High Court substantially to compel the Collector to carry out his statutory obligations under section 14 of the Act. The High Court normally does not entertain a petition under article 226 of the constitution to enforce a civil liability arising out of a breach of contract or a tort to pay and amount of money due to the claimant and leaves it to the aggrieved party to agitate the question in a civil suit filed for that purpose. But an order for payment of money may sometimes be made in a petition under article 226 of the constitution against the State or against an 248 officer of the State to enforce a statutory obligation. The petition in the present case is for enforcement of the liability of the Collector imposed by statute to refund a tax illegally collected and it was maintainable: but it can only be allowed subject to the restrictions which have been imposed by the Legislature. It is not open to the claimant to rely upon the statutory right and to ignore the restrictions subject to which the right is made enforceable. We are therefore of the opinion that the High Court was right in restricting the order of refund in the petition under article 226 of the constitution. The order of refund passed by the High Court, however, requires to be slightly modified and we direct that it shall run as follows: "That part of the sales tax which has been paid by Messrs. Burmah Construction Co. shall be refunded by the State of Orissa to the Burmah Construction company if the order of assessment pursuant to which payment was made was within 24 months of the date on which the petition was filed in the High Court, namely, 9th of August, 1954. Without deciding whether the Burmah Construction Co. has the right to recover the balance of the amount of ' the tax paid by other appropriate proceedings, the claim to recover the balance of the tax paid is dismissed. The appeal substantially fails and is dismissed with costs. Appeal dismissed.

The appellant who executed works contracts was assessed to sales tax for quarters ending June 30, 1949, to March 31, 1954, and paid the tax. On August 9, 1954, the appellant filed a writ petition before the High court for a declaration that the provisions of the orissa Sales Tax Act, 1947, permitting levy of sales tax on works contracts were ultra vires, for a declaration that the assessments were illegal and for a refund of the amount paid as tax the High court declared that the assessments were not in accordance with the law and directed refund of the tax paid, if recovery thereof was not barred under section 14 of the Act on the date of the filing of the writ petition. Section 14 provided that no claim for a refund shall be allowed by the Collector unless it was made within 24 months from the date of the assessment order or within 12 months of that order passed on appeal, revision, review or reference. The appellant contended that section 14 was ultra vires and that the bar of limitation in section 14 was not applicable to the writ petition before the High Court for refund of tax illegally recovered. ^ Held, that provisions of section 14 of the orissa Sales Tax Act, 1947, were not ultra vires the State Legislature. The power to legislate in respect of refund of tax improperly or illegally collected, and imposition of restrictions on the exercise of the right to claim refund which was an ancillary or subsidiary matter was not beyond the competence of the legislature. State of Orissa vs The orient Paper Mills Ltd., A. 1. R. , relied on. Held, further, that the bar of limitation in section 14 of the Act was applicable to the case. The proceedings before the High Court were substantially to compel the Collector to carry out his statutory obligations under section 14, and it could only be allowed subject to the restrictions imposed by the statute. it was not open to the appellant to rely upon the statutory right and to ignore the restrictions subject to which the right was made enforceable.

CIVIL Appeal No. 582 of 1960. Appeal from the judgment and order dated February 5, 1959, of the Madhya Pradesh High Court (Gwalior Bench) at Indore in Civil Misc. Case No. 11 of 1959. A. V. Viswanatha Sastri, Rameshwar Nath," section N. Andley and P. L. Vohra, for the appellant. B. Sen, B. K. B.Naidu and I. N. Shroff, for the respondent. 284 1961. October 31. The Judgment of the Court was delivered by MUDHOLKAR, J. This is an appeal on a certificate of fitness granted by the High Court of Madhya Pradesh under article 133 (1) (a) of the constitution. The appellant is a textile mill at Gwalior in Madhya Pradesh. It generates electricity for the purpose of running its mills and for other purpose connected therewith. It does not sell electrical energy to any person. Under the provisions of the Central Provinces and Berar Electricity Duty Act, 1949 (No. 10 of 1949)as amended by the Madhya Pradesh Taxation Laws Amendment Act, 1956 (Act No. 7 of 1956) the Government of Madhya Pradesh levied upon the appellant electricity duty amounting to Rs. 2,78,417/ for a certain period. The appellant paid it under compulsion and thereafter preferred a writ petition to the High Court of Madhya Pradesh under article 226 of the Constitution in which it challenged the validity of the levy on two grounds. The first ground was that upon a proper construction of section 3 of the C. P. & Berar Electricity Duty Act, 1949 as amended by the Madhya Pradesh Taxation Laws amendment Act, 1966 the appellant would not be liable to pay any duty at all. The second ground was that if the Act permitted the levy of duty on electricity consumed by the producer himself it was ultra vires the Constitution because in substance it would be a duty of excise which can be levied only by Parliament under Entry 84 of List I and that oven if it was not excise duty it was beyond the competence of the Madhya Pradesh legislature to levy it in the absence of any appropriate entry in List II. The petition was summarily rejected by the High Court, but upon an application made by the appellant it granted to it certificate of fitness, as already stated. 285 Mr. Viswanatha Sastri has reiterated before us the same grounds which were urged in the High Court. For the purpose of appreciating the first ground it would be useful to reproduce the terms of B. 3 of the Act. The section runs thus: "Levy of duty on sale or consumption of electrical energy Subject to the exceptions specified in Section 3 A every distributor of electrical energy and every producer shall pay every month to the State Government at the prescribed time and in the prescribed manner a duty calculated at the rates specified in the Table below on the units of electrical energy sold or supplied to a consumer or consumed by himself or his employees during the preceding month. Table Rates of Duty (i) Electrical energy supplied for consumption for lights, fans of any other appliances normally connected to a lighting circuit. 6 nP. per unit of energy. (ii) Electrical energy supplied for purposes other than those specified in item (i) above. 1 nP. per unit of energy. This is the charging section. It is not disputed by Mr. Sastri that under this provision a producer of electrical energy is made liable to pay duty for the units of electrical energy consumed by himself. He, however, contends that rates of duty have been prescribed in the Table below section 3 only with respect to electrical energy "supplied for consumption" to others and that no rates have been prescribed with 286 respect to electrical energy consumed by the producer himself. Section 2(a) of the Act defines "consumer". The definition, so far as relevant, runs thus: " `Consumer ' means any person who consumes electrical energy sold or supplied by a distributor of electrical energy or a producer. . . " `Producer ' as defined section 2(d 1) of the Act means "a person who generates electrical energy at a voltage exceeding hundred volts for his own consumption or for supplying to others". If we read the two definitions together, omitting the non essentials, 'consumer ' would include " 'any person who consumes electrical energy supplied by a person who generates electrical energy for his own consumption". under section 3 a person who generates electrical energy over hundred volts for his own consumption is liable to pay duty on the units of electrical energy consumed by himself. A producer consuming the electrical energy generated by him is also a consumer, that is to say, he is a person who consumes electrical energy supplied by himself. The Table prescribes rates of duty payable with respect to electrical energy supplied for consumption and, therefore, the levy on the appellant falls squarely within the Table under section 3 of the Act and M/s. Viswanatha Sastri 's argument is devoid of substance. It is difficult to see how the levy of duty upon consumption of electrical energy can be regarded as duty of excise falling within Entry 84 of List I. Under that Entry what is permitted to Parliament is levy of duty of excise on manufacture or production of goods (other than those excepted expressly by that entry). The taxable event with respect to a duty of excise is "manufacture" or "production". Here the taxable event is not production or generation of electrical energy but 287 its consumption. If producer generates electrical energy and stores it up, he would not be required to pay any duty under the Act. It is only when he sells, it or consumes it that he would be rendered liable to pay any duty prescribed by the Act. The Central Provinces and Berar Electricity Act was enacted under Entry 48B of List II of the Government of India act, 1935. The relevant portion of that Entry read thus: "Taxes on the consumption or sale of electricity. . " Entry 53 of List II of the Constitution is to the same effect. The argument of Mr. Sastri is that the word "consumption" should be accorded the meaning which it had under the various Act, including the Indian Electricity Act, 1980. Under that Act and under the various Provincial and Act, consumption of electricity mean, according to him, consumption by persons other than producers and that both in the Government of India Act any under the Constitution the word 'consumption ' must be deemed to have been used in the Fame sense. The Acts in question deal only with a certain aspect of the topic " 'electricity", and not with all of them. Therefore, in those Acts the word "consumption" they have a limited meaning, as pointed out by learned counsel. But the word "consumption" has a wider meaning. It means also "use up" "spend" etc. The mere fact that a series of laws were concerned only with a certain kind of use of electricity, that is consumption of electricity by persons other than the producer cannot justify the conclusion that the British Parliament in using the word "consumption" in Entry 48B and the Constituent Assembly in Entry 53 of List he wanted to limit the meaning of "consumption" in the same way. The language used in the legislative entries in the Constitution must be interpreted in a broad way so as to give the widest amplitude of power to the legislature to legislate and not in a narrow and pedantic sense. we 288 cannot, therefore, accept either of the two grounds urged by or. Viswanatha Sastri challenging the vires of the Act. The appeal fails and is dismissed with costs.

The appellant mill produced electricity over 100 volts exclusively for its own consumption. It challenged the levy of the electricity duty by the Government of Madhya Pradesh (1) ; 283 under the C. P. and Berar Electricity Act as 1949, by the Madhya Pradesh Act 7 of 1956, on the grounds, firstly that on proper construction of section 3 of the Act it was not liable to pay any duty at all as the Table of rates did not prescribe any rate for electricity consumed by producers and, secondly, the levy of duty on electricity consumed by producer himself being in substance an excise duty could be levied only by the Parliament under Entry 84 List I. If it was not an excise duty the levying of it was beyond the competence of the State Legislature in the absence of any appropriate Entry in the List. ^ Held, that on a combined reading of the definition of 'consumer ' in section 2(a) and 'producer ' in section 2(d 1) of the C. P. & Berar Act, 10 of 1949, a producer, consuming the electrical energy generated by him is also a consumer as he consumes electrical energy supplied by himself, falls squarely within the Table under section 3 of the Act prescribing rates of duty payable by a consumer and is therefore liable to pay duty thereunder. Held, further, that the present Act for levy of duty upon consumption of electric energy was enacted under Entry 45B of the List II of the Government of India Act, 1935, corresponding to Entry 53 of List II of the Constitution where as the levy of duty of excise on manufacturer production of goods by Parliament is under Entry 84 of List I. The taxable event with respect to a duty of excise is 'manufacture ' or 'production '; and not 'consumption '; the levy upon consumption of electric energy cannot be regarded as duty of excise falling within Entry 84 of List I. Held, also, the language used in the Legislative Entries in the Constitution must be interpreted in a broad way so as to give the widest amplitude of power to the Legislature to legislate and not in a narrow and pendantic sense.

Civil Appeal No. 592 of 1960. Appeal by special leave from the judgment and order dated June 17, 1959, of the Commercial Tax officer, Calcutta, in case No. 54(c) of 1969 60. 277 N. a. Chatterjee and section a. Mazumdar, for the appellants. B. Sen and P. E. Bose, for respondents Nos. 1 and 2. K. N. Rajagopal Sastri and T. M. Sen, for respondent No. 3. 1961. October 31. The Judgment of the Court was delivered by SINHA, a. J. This is a direct appeal by special leave granted by this court on September 7, 1969, against the order, dated July 17, 1959, passed by the first respondent the Commercial Tax officer assessing the appellant to central sales tax amounting to Rs. 42,647 odd, for the period July 30, 1957 to March 31, 1958, under the (LXXIV of 1956) which hereinafter will be referred to as the Act. The second respondent is the State of West Bengal, and the third respondent is the Union of India. In view of the order we propose to make in this ease, it is not necessary to state in any detail the facts and circumstances leading up to this appeal. The appellant is a partnership firm, under the Indian Partnership Act, with its principal place of business at 18, Netaji Subhas Road, Calcutta, within the jurisdiction of the first respondent. The appellant alleges that he carries on business of two kinds, namely, (1) of a dealer in coal and coke, and (2) of a middleman bringing about sales of coal and coke between colliery owners and consumers. In respect of its business as a dealer, the appellant is a registered dealer under the Bengal Finance (Sales Tax) Act (Bengal Act VI of 1941). Its second business as a middleman relates mainly to sales of coal and coke in the course of interstate trade or commerce, and the tax in question relates to this second branch of its business. The Act came into operation in the State of West Bengal on July 1, 1957, when the appellant 278 applied for and obtained a certificate of registration under the Act on July 30, 1957. In May 1958, the appellant made its return under the Act in respect of the period aforesaid, showing the turnover as nil. But in spite of its showing cause against the proposed assessment, the first respondent determined Rs.9,17,196 as the appellant 's turnover in respect of the period aforesaid and assessed central sales tax thereon at Rs. 42,617.82nP. under section 8(2) of the Act, and issued Demand Notice. The appellant moved this Court and obtained the special leave to appeal from the order of the first respondent making assessment and later a demand on the basis of the assessment. From the statement of facts given above, it is clear that the appellant did not exhaust all his remedies under the Act itself; and came directly to this Court as if the order of Assessment passed by the first respondent was final. The question, therefore, arises whether this court should entertain the appeal, when even the facts have not been finally determined by the final fact finding authority under the Act, nor has the jurisdiction of the High Court been involved to exercise its power under the Act. But Mr. Chatterjee, on behalf of the appellant, has contended in the first instance that the powers of this Court are wide enough to enable him to approach this Court direct, when according to him, there had been an assessment of tax without the authority of law. There is no doubt that the powers of this Court under article 136 of the Constitution are as wide as they could be, because, unlike the preceding articles of the constitution, there is no limitation that the Judgment, decree or order should be final in the sense that the appellant in this Court has exhausted all the remedies provided by law before invoking the jurisdiction of this Court to grant "special leave to appeal from any judgment, decree determination sentence or order in any case or matter passed or 279 made by any Court or Tribunal in the territory of India. " In spite of the wide amplitude of the jurisdiction of this Court to entertain appeals by special leave, this Court has imposed certain limitations on its own powers for very good reasons, and has refused ordinarily to entertain such appeals when the litigant has not availed himself of the ordinary remedies available to him at law. But Mr. Chatterjee, on behalf of the appellant, invited our attention to the decision of this Court in Mahadayal Premchandra vs Commercial Tax officer, Calcutta (1) in which this Court interfered with the order of assessment passed by the Commercial Tax officer of Calcutta, and this Court had been moved by way of special leave to appeal against the original order of the Taxing officer. It is claimed on behalf of the appellant that decision completely covers the points in controversy in the present case also. It is contended that was also a case, like the present one of commission agents who had been charged sales tax. There are several reasons why the authority of that decision cannot be invoked in favour of the appellant on the preliminary question whether this Court should at all entertain the appeal. In that case, in the reported decision, of this Court, no such question, as we have to determine, had been raised. Apparently, counsel for both the parties were anxious to have the final determination of the controversy by this Court. Secondly, there were special circumstances in that case, which are not present in the instant case. The most outstanding feature of that case was, as pointed out by this Court, that the Assessing Authority had not exercised its own judgment in the matter of the assessment in question. The Assessing Authority had, contrary to its own judgment, taken instructions from the Assistant Commissioner and followed those directions This Court had also pointed out that even (1) 280 though the Assessing Authority was satisfied on the materials placed by the assessee that he was not liable to pay sales tax, he carried out the directions of a superior officer. This Court further pointed out that there had been complete failure of justice on account of the, fact that the assessee had been given no opportunity to meet the points made by the Assistant Commissioner, and the assessment order was made behind his back. The Court was led to make the following very significant observations: "The procedure adopted was, to say that least, unfair and was calculated to undermine the confidence of the public in the impartial and fair administration of the sales tax Department concerned. We would have, simply on this ground, set aside the assessment order made by the first respondent and remanded the matter back to him for his due consideration in accordance with law, but as the matter is old and a remand would lead to unnecessary harassment of the appellants, we have preferred to deal with the appeal on merits." (p. 560). It was in those circumstances that this Court went into the whole controversy on its merits and determined the appeal in favour of the assessee. That case, therefore, in no precedent in favour of the appellant. The next case relied upon by the counsel for the appellant is The State of Bombay vs M/s. Ratikal Vadilal(1). That was a case in which the State of Bombay had appealed to this Court on special leave against the order of the Sales Tax Tribunal, Bombay, by which the Tribunal had allowed the appeal before it and set aside the order of the Collector of Sales Tax, under the Bombay Sales Tax Act. The respondents in that case were commission agents doing business as clearing and (1) ; 281 transport contractors. They had applied to the Collector of Sales Tax, Bombay, for the determination of the question if they could be called "dealers" within the meaning of the Act after giving the facts and circumstances of their case. In that case also no steps had been taken to have a reference made to the High Court, and this Court observed that it has been frequently noticed that appeals had been filed to this court without exhausting all the remedies open to appellants and that ordinarily this Court would not allow the High Courts to be bypassed and the appropriate course for an appellant was to exhaust all his remedies before invoking the jurisdiction of this Court under article 136 of the constitution. But this Court went into the merits of this case because both the parties invited the Court to do so and did not insist upon the preliminary is an being decided. It is clear, therefore, that neither of the two cases relied upon by counsel for the appellant is an authority for the proposition that he can come up to this Court on special leave directly against the judgment of the Assessing Authority, without exhausting all his remedies under the Act. There are cases in which this Court was moved directly against the order of assessment, after ignoring the orders of the High Court refusing to have a reference made, or decision the point referred, against the assessee. In those circumstances, this Court refused to entertain the appeal and held that the appellant was not entitled to invoke the jurisdiction of this Court under article 136, without coming up in appeal from the final decision inter parties given by the High Court. The latest decision of this Court on that question is the case of Chandi Prasad Chokhani vs The State of Bihar (1). In that case, the previous decisions of the Court have all been considered on extenso. We are in entire agreement with what has been laid down by this Court in that batch of cases. other decision of a Division Bench of (1) ; 282 this Court is the case of Kanhaiyalal Lohia vs Commissioner of Income tax, West Bengal (1). In that case, this Court has taken the same view and dismissed the appeal as 'incompetent. ' The present case in a much simpler one, in which there are no special circumstances and in which the facts have not yet been finally deter mined. It may also be noted that the appellant has not challenged the vires of the Act or of any other law. We, therefore, think that we should dismiss this appeal as 'incompetent ', without expressing any opinion on the merits of the controversy. It will be open to the appellant to take such steps as it may be advised, in pursuing such remedies as may be available to it under the law. The appeal is accordingly dismissed, but in the circumstances without Costs. Appeal dismissed.

In respect of its business as a middleman relating mainly to sales of coal and coke in the course of inter State trade, the appellant firm was assessed to Central sales tax under section 8(2) of the , by the Commercial Tax officer. The appellant without availing itself of the remedies under the Act, applied for and obtained special leave to appeal under article 136 of the Constitution of India directly against the order of assessment When the appeal was taken up for hearing, the question was raised as to whether it should be entertained, when even the facts had not been finally determined by the final fact finding authority under the Act, nor had the jurisdiction of the High Court been invoked to exercise its powers under the Act. Held, that an assessee is not entitled ordinarily to come up to the Supreme Court directly against the judgment of the Assessing Authority and invoke the Court 's jurisdiction under article 136 of the Constitution without first exhausting the remedies provided by the taxing statutes. Mahadayal Premchandras vs Commercial Tax Officer Calcutta, and The State of Bombay vs M/s. Ratilal Vedilal, [1961] 2 section C. R. 367, explained. Chandi Prasad Chokhani vs The State of Bihar, [1962] 2 section G. R. 276 and Kanhaiyalal Lohia v, Commissioner of Income Tax Bengal, [1962] 2 section C. R. 839, followed. ^ Held, further, that in the present case, in which there, were no special circumstances and in which the facts had not yet been finally determined, the appeal must be considered to be incompetent.

ION: Criminal Appeal No. 63 of 1960. Appeal by special leave from the judgment and order dated October 9, 1959, of the Bombay High Court in Criminal Reference No. 94 of 1959. A. V. Viswanatha Sastri, section N. Andley and Rameshwar Nath, for the appellant. R. Ganapathy Iyer and R. H. Dhebar, for respondent. October 27. The Judgment of Kanpur an Dayal, JJ., was delivered by Dayal J. Subba Rao, J., delivered a separate Judgment. RAGHUBAR DAYAL, J. This appeal, by special leave, is directed against the order of the High Court of Bombay, rejecting, the reference made by the additional Sessions Judge, Nasik, and confirming the conviction of the appellant under section 92 of the factories Act, 1948 (Act LXIII of 1948), hereinafter called the Act. The appellant is the owner and occupier of "Jay Parkash Sudhir Private Ltd., a factory which manufactures bidis. Pandurang Trimbak Londhe, hereinafter called Pandurang, rolled bidis in that factory for a number of days in 1957. He ceased to do that work from August 17, 1957. It was alleged by the prosecution that the appellant terminated Pandurang 's services by a notice put up on August 12, 1957. The appellant, however, admitted the putting up of such a notice, but denied that Pandurang, the labourer, had left his service of his own accord. 252 Inspector Shinde, P.W.I, visited this factory August on 22, 1957. He found from the weekly register and the wages register of the Factory that Pandurang worked for 70 days and earned 4 days T. leave. Pandurang, however, did not enjoy that leave and was therefore entitled to be paid wages for that period i.e., for 4 days ' leave. He was not paid those wages, and therefore, the appellant contravened the provisions of section 79(11) of the Act. He consequently submitted a complaint against the appellant to the Judicial Magistrate, First Class, Sinnar. It was contended for the accused before the Magistrate that Pandurang was not a worker within the meaning of that expression, according to s.2(1) of the Act and that therefore no leave could be due to him and the appellant could not have committed the offence of contravening the provisions of s.79(11). The learned Magistrate did not agree with the defence contention and held Pandurang to be a worker and convicted the appellant of the offence under 8. 92 read with section 79(11) of the Act and sentenced him to a fine of Rs. 10. It may be mentioned that this case was a test case. Similar cases against the appellant with respect to the non payment of leave wages to other workers were pending in the Court. The appellant went in revision to the Court of the learned Additional Sessions Judge, Nasik. The Sessions Judge was of the opinion that Pandurang was not a worker and that the conviction of the appellant was bad. He accordingly referred the case to the High Court. The High Court, however did not agree with the view of the Sessions Judge and, holding that Pandurang was a worker, rejected the revision and confirmed the conviction and sentence. It is against this order that this appeal has been filed. Two points have been raised on behalf of the appellant. One is that Pandurang was not a 253 worker within the meaning of that expression in the Act. The other is that even if Pandurang was a worker, he was not entitled to any leave wages under section 80 of the Act. The first contention is based on the established facts of the case which, it is submitted, do not make out the relationship of master and servant between the appellant and Pandurang, inasmuch as they indicate that the appellant had no supervision and control over the details of the work Pandurang did in the factory. The following are the established facts: (1) There was no agreement or contract of service between the appellant and Pandurang. (2) Pandurang was not bound to attend the factory for the work of rolling bidis for any fixed hours of work or for any filed period. He was free to go to the factory at any time he liked and was equally free to leave the factory whenever he liked. Of course, he could be in the factory during the hours of working of the factory. (3) Pandurang could be absent from work on any day he liked. He could be absent up to ten days without even informing the appellant. If he was to be absent for more than ten days he had to inform the appellant, not for the purpose of taking his permission or leave, but for the purpose of assuring the appellant that he had no intention to give up work at the factory. (4) There was no actual supervision of the work Pandurang did in the factory. (5) Pandurang was paid at filed rates on the quantity of bidis turned out. There was however no stipulation that he had to turn out any minimum quantity of bidis in a day. (6) Leaves used to be supplied to Panduarng for being taken home and cut there. 254 Tobacco to fill the bidis used to be supplied at the factory. Pandurang was not bound to roll the bidis at the factory. He could do so at his place, on taking permission from the appellant for taking tobacco homes. The permission was necessary in view of Excise Rules and not on account of any condition of alleged service. (7) At the close of the day, the bidis used to be delivered to the appellant and bidis not up to the standard, used to be rejected. The second contention is based on the inapplicability of the provisions of sections 79 and 80 of the Act to the case of the appellant, inasmuch as it is not possible to calculate the number of days he worked or the total full time earnings for the days on which he worked during the relevant period mentioned in section 80. On behalf of the respondent State, it is submitted that the appellant had the right to exercise such supervision and control over the work of Pandurang as was possible with respect to the nature of Pandurang 's work which was of a very simple kind and that therefore Pandurang was a worker. It is further urged that there is no difficulty in calculating the number of working days or the total full time earnings contemplated by section 80 of the Act. We have given very anxious consideration to this case, as the view taken by the Court below in this case had been stated to be the right view in the decision of this Court in Shri Birdhichand Sharma. The first Civil Judge, Nagpur (1), on which reliance is placed by the respondent. The fact of that case are distinguished and only some of the facts of that case are similar to some of the facts of this class. The similar facts are only these: Pandurang as well as the workers in that case could go to the factory (1) ; 255 at any time and leave it at and time, within the filed hours of work and they were paid at piece rates and the bidis below the standard were rejected. It is to be noticed that the decision in that case is based on facts which do not exist in the present case. That decision, therefore, is distinguishable and the opinion about the view of the High Court in the present case to be correct, appears to have been expressed without noticing that the facts of this case are different in material respects from the facts of the case this court was deciding. The decision of that case it based really on the following facts: (1) The alleged workers had to work at the factory. (2) Their attendance was notes. (3) If they came to the factory after mid day, they were not given any work and they thus lost wages. (4) The management had the right to remove them if them stayed away for a continuous period of eight days. In the present case, Pandurang could work at the house if the appellant permitted tobacco to be taken home. There is nothing on record to show the attendance is noted. Of course, the days Pandurang worked could be found out from the work register. It is not the case here that no work was to be given to Pandurang if he want to the factory after mid day. There is no allegation that the appellant had the power to remove him, as a result of continued absence for a fixed number of days. We are therefore of opinion that the decision in Birdhichand 's Case (1) is distinguishable on facts and cannot be applicable to the facts of this (1)[1961] 3 section C.K. 161. 256 The one essential ingredient which should exist to make a person come within the definition of 'worker ' in cl. (1) of section 2 of the Act is that he be employed in one of the processes mentioned in that Clause. There is no dispute that the work which Pandurang did came within one of such processes. The sole question for determination then is whether Pandurang can be said to be employed by the appellant. This Court, in Shri Chintaman Rao vs The State of Madhya Pradesh (1), said: "The concept of employment involves three ingredients: (1) employer (2) employee and (3) the contract of employment,. The employs is one who employs, i.e., one who engaged the services of other persons. The employee is one who works for another for hire. The employment is the contract of service between the employer and the employee whereunder the employee agrees to serve the employer subject to his control and supervision. " Employment brings in the contrast of service between the employer and the employed. We have mentioned already that in this case there was no agreement or contract of service between the appellant and Pandurang. What can be said at the most is that whenever Pandurang went to work, the appellant agreed to supply him tobacco for rolling bidis and that Pandurang agreed to roll bidis on being paid at a certain rate for the bidis turned out. The appellant exercised no control and supervision over Pandurang. Further section 85 empowers the State Government to declare that certain provisions of the Act would apply to certain places where a manufacturing process is carried on, notwithstanding the persons therein are not employed by the owner (1) ; , 1346,1349,1350, 1351. 257 thereof but are working with the permission of or under agreement with such owner. This provision draws a distinction between the person working being employed by the owner and a person working, with the permission of the owner or under agreement with him. We are of opinion that the foots of this case strongly point to Pandurang 's working with the permission of or under agreement with the owner and not on any term of employment by the owner. Further, the facts of the case indicate that the appellant had no control and supervision over the details of Pandurang 's work. He could not control his hours of work. He could not control his days of work. Pandurang was free to absent himself and was free to go to the factory at any time and to have it at any time according to his will. The appellant could not insist on any particular minimum quantity of bidis to be turned out per day. He could not control the time spent by Pandurang on the rolling of a bidi or a number of bidis. The work of rolling bidis may be a simple work and may require no particular supervision and direction During the process of manufacture. But there is nothing on record to show that any such direction could be given. In this connection reference may again be made to the observation at page 1349 in Shri Chintaman Rao 's Case. The Court was considering whether the Sattedars were workers or were independent contractors Sattedars used to receive tobacco from the management and supply them rolled bidis. They could manufacture bidis outside the factory and should also employ other labour. It was in these facts, that it was said: "The management cannot regulate the manner of discharge of his work. " In the present case too, Pandurang used to be supplied tobacco. He could turn out as many bidis (1)[1958] section C. R. 1340, 1346, 1349, 1350, 1351. 258 as he liked and could deliver them to the factory when he wanted to cease working. During his period of work, the management could not regulate the manner in which he discharged his work. He could take his own time and could roll in as many bidis as he liked. His liability under the daily agreement was discharged by his delivering the bidis prepared and the tobacco remaining with him unused. The appellant could only order or require Pandurang to roll the bidis, using the tobacco and leaves supplied to him, but could not order him as to how it was to be done. We are therefore of opinion that the mere fact that the person rolling bidis has to roll them in a particular manner can hardly be said to give rise to such a right in the management as can be said to be a right to control the manner of work. Every worker will have to turn out the work in accordance with the specifications. The control of the management, which is a necessary element of the relationship of master and servant, is not directed towards providing or dictating the nature of the article to be produced or the work to be done, but refers to the other incidents having a bearing on the process of work the person carries out in the execution of the work. The manner of work is to be distinguish. ed from the type of work to be performed. In the present case, the management simply says that the labourer is to produce bidis rolled in a certain form. How the labourer carries out the work is his own concern and is not controlled by the management, which is concerned only with getting bidis rolled in a particular style with certain contents. Further, this Court, in Shri Chintaman Rao 's Case (1)examined the various provisions of the Act and then said: "The scheme of the aforesaid provisions indicates that the workmen in the factory are under the direct supervision and control of the management. The conditions of service (1) , 1346, 1349, 1350, 1951. 259 are statutorily regulated and the management is to conform to the rules laid down at the risk of being penalised for dereliction of any of the statutory duties. The management obviously cannot fix the working hours, weekly holidays, arrange for night shifts and comply with other statutory requirements, if the persons like the Sattedars, working in their factories and getting their work done by others or through coolies, are workers within the meaning of the Act. It is well high impossible for the management of the factory to regulate their work or to comply with the mandatory provisions of the Act. The said provisions, therefore, give a clear indication that a worker under the definition of the Act is a person who enters into a contract of service under the management and does not include an independent contractor or his coolies or servants who are not under the control and supervision of the employer. " It can be said, in the present case too, that the appellant could not fix the working hours or weekly holidays or asked arrangements for night shifts and comply with other statutory requirements, if Pandurang be held to be a worker within the meaning of the Act. We are therefore of opinion that Pandurang was not a worker. It is true, as contended for the State, that persons engaged to roll his on job work basis could be workers, but only such persons would be workers who work regularly at the factory and are paid for the work turned out during their regular employment on the basis of the work done. Piecerate workers can be workers within the definition of 'worker ' in the Act, but they must be regular workers and not workers who come and work according to their sweet will. It is also true, as urged for the State that a worker, within the 260 definition of that expression in the Act, need not be a whole time worker. But, even then, the worker must have, under his contract of service, an obligation to work either for a fixed period or J. between fixed hours. The whole conception of service does not fit in well with a servant who has full liberty to attend to his work according to his pleasure and not according to the orders of his master. We may say that this opinion further finds support from with we hold on the second contention. If Pandurang was a worker, the provisions about leave and leave wages should apply to him. We are of opinion that they do not and what we may in that connection reinforces our view that Pandurang was not a worker as the three criteria and conditions laid down in Shri Chintaman Rao 's Case (1) for constituting him as such are not fulfilled in the present case. Before discussing the provisions of ss.79 and 80 of the Act. which deal with leave and wages for leave, we would like to state that the terms on which Pandurang worked, did not contemplate any leave. He was not in regular employ. He was given work and paid according to the work he turned out. It was not incumbent on him to attend to the work daily or to take permission for absence before absenting himself. It was only when he, had to absent himself for a period longer than ten days that he had to inform the management for administrative convenience, but not with a view to take leave of absence. Section 79 provides for annual leave with wages and section 80 provides for wages during leave period. It is on the proper construction of the provision of these sections that it can be said whether the appellant contravened the provisions of sub section (11) of 8. 79 of the Act and committed the offence under s.92 of the Act. (1) ; , 1346, 1349,1350, 1351. 261 Sub section (1) of section 79 reads: "(1) Every worker who has worked for a period of 240 days or more in factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of (1) if an adult, one day for every twenty days of work performed by him during the previous calendar year; (ii) if a child, one day for every fifteen days of work performed by him during the previous calendar year. Explanation 1. For the purpose of this sub section (a) any days of lay off, by agreement or contract or as permissible under the standing orders, (b) in the case of a female worker, maternity leave for any number of days not exceeding twelve weeks; and (c) the leave earned in the` year prior to that in which the leave is enjoyed; shall be deemed to be days on which the worker has worked a factory for the purpose of computation of the period of 240 days or more, but shall not earn leave for these days. Explanation 2. The leave admissible under this sub section shall be exclusive of all holidays whether occurring during or at either end of the period of leave. " It is clear that this applies to every worker. If it does not apply to any type of person working in the factory, it may lead to the conclusion that the person does not come within the definition of the word 'worker '. 262 The worker is to get leave in a subsequent year when he has worked for a period of 240 days or more in the factory during the previous calendar year. Who can be said to work for a period of J. 240 days? According to cl. (e) of 8. 2, 'day ' means a period of twenty fore hours beginning at mid night. Section 51 lays down that no adult worker shall be required or allowed to work in a factory for more than forty eight hours in any week, and, according to section 54, for not more than nine hours in any day. Section 61 provides that there shall be displayed and correctly maintained in every factory a notice of periods of work for adults showing clearly for every day the periods during which adult worker may be required to work and that such periods shall be fixed beforehand and shall be such that workers working for those periods would not be working in contravention of any of the provisions of sections 51, 52, 54, 55, 56 and 58. Section 63 lays down that no adult worker shall be required or allowed to work in any factory otherwise than in accordance with the notice of periods of work for adults displayed in the factory. A 'day ', in this context, would mean a period of work mentioned in the notice displayed. Only that worker can therefore be said to work for a period of 240 days, whose work is controlled by the hours of work he is required to put in, according to the notice displayed under section 61. Pandurang was not bound to work for the period of work displayed in the factory and therefore his days of work for the purpose of section 79 could not be calculated. It is urged for the State that each day on which Pandurang worked, whatever be the period of time that he worked, would count as one day of work for the purpose of this section. We do not agree with this contention. When the section provides for leave on the basis of 263 the period of working days, it must contemplate a definite period of work per working day and not any indefinite period for which a person may like to work on any particular day. Section 80 provides for the wages to be paid during the leave period and its sub s.(1)reads: "For the leave allowed to him under section 79, a worker shall be paid at a rate equal to the daily average of his total full time earnings for the days on which he worked during the month immediately preceding his leave, exclusive of any overtime and bonus but inclusive of dearness allowance and the cash equivalent of the advantage accruing through the confessional sale to the worker of foodgrains, and other articles. " The question is how the daily average of his total full time earnings for the days on which he worked during the month immediately preceding his leave is to be calculated. It is necessary for the calculation of the rate of wages on leave, to know his, total 'full time earnings, ' for the days he had worked during the relevant month. What does the expression 'total full time earnings ' mean? This expression is not defined in the Act. It can only mean the earnings he earns in a day by working full time of that day, full time to be in accordance with the period of time given in notice displayed in the factory for a particular day. This, is further apparent from the fact that any payment for overtime or for bonus is not included in computing the total full time earnings Full time ', according to Webster 's International Dictionary, means the amount of time considered the normal or standard amount or working during a given period, as a day? week or month '. 264 In Words & Phrases, Permanent Edition, published by West Publishing Co., Vol. 17, with regard to the expression 'Full time ' it is stated: In an industrial community, term 'full time ' has acquired definite significance recognized by popular usage. Like terms 'part time ' and 'over time ' it refers to customary period of work; and all these terms assume that a certain number of hours per day or days per week constitute respectively a days or week 's work within a given industry or factory. " It is also stated at page 791: " 'Full time ' as basis for determination of average weekly wages of injured employee means time during which employee is offered employment, excluding time during which he has no opportunity to work. " We are therefore of opinion that there can be no basis for calculating the daily. average of the worker 's total full time earnings when the terms of work be as they are in the present case and that therefore the wages to be paid for the leave period cannot be calculated nor the number of days for which leave with wages can be allowed be calculated in such a case. It does not appear from the record, and it is not likely, that any period of work is mentioned in the notice displayed under section 61, with respect to such workers who can come at any time they like and go at any time they like and turn out as much work as they like. For the reasons stated above, we are of opinion that the conviction of the appellant for an offense under section 92; read with section 79(11) of the Act is wrong. We accordingly set aside the order of the Court below and acquit the appellant. Fine, if paid, will be refunded. 265 SUBBA RAO, J. I have had the advantage of perusing the judgment Prepared by my learned brother day, J. I regret my inability to agree. The question raced in this appeal is directly covered by the judgment of this Court in Birdhi Chand, Sharma vs First Civil Judge, Nagpur (1). As my learned brother has taken a different view, I propose to give reasons for my conclusion. This appeal by special leave is directed against the judgment of the High Court of Bombay in Criminal Reference No. 94 of 1955 made by the Additional Sessions Judge. Nasik, under section 438 of the Code of Criminal Procedure, and it raises the question of interpretation of some of the provisions of the (63 of 1948), (hereinafter referred to as the Act). The appellant is the owner of a factory named ' 'Jay Parkash Sudhir Private Ltd." engaged ill the manufacture of bidis. He engaged 60 persons for the work of rolling bidis in his factory. On August 12, 1267, the appellant issued a notice to the said persons terminating their services with effect from August 17, 1957. On August 22, 1957, the Inspector of Factories paid a visit to the factory found that one of the said persons by name Pandurang Trimbak had worked for 70 days in the factory and had earned leave for 4 days which he had not enjoyed nor was he paid wages in lieu of the leave before his discharge. It is not disputed that the position in regard to the other 59 persons is also similar. The Inspector of Factories filed 60 complaints against the appellant in the Court of the Judicial Magistrate, First Class, Sinnar, For infringing the provisions of section 79(2) of the Act. The Magistrate found to appellant guilty and convicted and sentenced him to pay a fine of Rs. 10 On revision, the learned Additional Sessions Judge, Nasik, taking the view that the convection should be quashed. referred the matter (1) ; 266 to the High Court under section 438 of the Code of Criminal Procedure. A division bench of the a High Court, on a consideration of the facts found the material provisions of the Act and the relevant decisions cited, come to the conclusion that a person rolling bidis in a factory is a "worker" within the meaning of B. 2(1) of the Act and on that basis upheld the order of conviction and sentence passed by the learned Magistrate. Hence this appeal. Learned counsel for the appellant contends that the persons rolling bidis in the factory are not "workers" within the meaning of the Act, as the said persons can come any day they like, work as they like and, therefore, they cannot be said to by employed by the manufacturer under the Act. Alternatively he argues that even if they were ' 'workers", section 79 of the Act, which deals with the question of leave with wages, cannot apply to a worker who is paid wages according to the quantity of work done by him and not per day or par week. At the outset it would be convenient to ascertain exactly how these persons rolling bidis are engaged by the appellant and how they work ill the factory. Admittedly, Pandurang Trimbak and other 59 persons were engaged by the appellant for rolling bidis in his factory. The registers maintained by the factory, namely, weekly register and wages register, had on their rolls the names of the said persons as labourers for doing the said work. It is also common case that the said persons attend the factory and roll bidis in the premises of the factory during the working hours of the factory. Leaves are supplied to the labourers on the previous day, which they cut in their houses after dipping them in water, and on the neat day, when they go to the factory, tobacco is given to them. After they make the bidis the matter verifies whether they are according to the sample. Those that are not according to the sample are rejected. Thereafter the quantity of 267 bidis rolled by each labourer is entered in the bidi map register maintained by the factory. D. W. 1 is a gumasta and general supervisor in the factory. He supervises the work of the man who supplies tobacco. He enters the quantity of bidis rolled by each labourer against his name in the register and if a labourer is absent, his absence is noted against his name in the said register. The labourers are paid at the rate of Rs. 2 2 O, or such other rate as agreed by them, per thousand bidis rolled. So far there is no difference between a labourer working in the appellant 's factory and a labourer working in any other factory. Just like any other manufacturer, the appellant engages the labour, allots work for them and extracts work from them and pays them wages for the work so done. Now let us look at the differences between the labourers in a bidi factory and those in other factories on which much emphasis is laid by learned counsel for the appellant. P. W. 1, the Inspector of Notified Factories, says that during their working in the factory, there, is no supervision over them. P. W. 2, Pandurang Trimbak, admits in the cross examination that during the factory hours he used to work in the factory of the appellant at any time and go at any time. He further states that they can sit at any compartment of the factory and there is no compulsion on the labourer to do a minimum quantity of work every day and that the permission of the master is required only if a labourer wants to absent for more than ten days or when he wants to bind bidis in his house. D. W. 1, the gumasta and supervisor in the factory, also says that a labourer can leave the factory in the midst of work after giving the finished product and after returning the tobacco. He says that at the time of receiving the finished goods, he verifies whether the goods are according to sample and then makes the requisite entries in 268 the register. What emerges from this evidence is that there in no supervision in the sense that nobody regulary watches their work from start to finish giving directions, if and when required. But the labourers understand that the bidis to be rolled in by them shall accord with the sample and, therefore, they roll the bidis to accord with that sample. The names of persons that are absent, the quantity of tobacco issued to each of the labourer, and the number of bidis rolled by each of them are entered in the appropriate registers. The rejected bidis are given way to the labourers; it cannot obviously mean that dereliction of duty is rewarded but it only shows that the rejected bidis are insignificant in number. In short, the appellant engages a labourer, extracts work from him, pays him wages in accordance with the quantity of bidis rolled by him, and exercises a right of supervision as the nature of the work requires. With this background let us look at the definition of "worker ' in section 2(1) of the act ' 'Worker" is defined to mean ' 'a person employed, directly or through agency, whether for wages or not in any manufacturing process. "Under this definition, a person employed in a manufacturing process in a worker. The question raised in this case turns upon the interpretation of the word 'employed" in the definition. This Court in Chintaman Rao vs State of Madhya Pradesh ( '1A) defined the word ' 'employed" thus: "The concept of employment involves three ingredients: (1) employer (2) employee and (3) the contract of employment. The employer is one who employs, i.e., one who engages the services of other persons. The employee is one who works for another for hire. The employment is the contract of (1A) ; , 1346. 269 service between the employer and the employee whereunder the employee agrees to s serve the employer subject to his control and supervision. " In making out the distinction between an employer and an independent contractor, this court in the above case quoted the following observations of Bhagwati J, in Dharangadhara Chemical Works Ltd . vs State of Saurashtra (1): "The test which is uniformly applied in order to determine the relationship is the existence of a right of control in respect of the manner in which the work is to be done. " The some view was reiterated. by this Court in The State of Kerala vs V.M. Patel (2). That was a case where 23 persons were employed in the process of garbling pepper and packing them in bags. Hidayatullah, J."speaking for the Court stated: "It was observed that, to determine whether a person was a '"worker", the proper test was to see whether or not the "employer" has control and supervision over the manner in which the work was to be done". Adverting to the distinction between an independent contractor and a servant, the learned Judge proceeded to state: "An independent contractor is charged with a work and has to produce a particular result; but the manner in which the result is to he achieved left to him. A servant, on the other hand may also be charged with the work and asked to produce a particular result, but is subject to the directions of the matter as to the manner in which tho result is to be achieved." (1) [1957] S.C.R.152,157. (2) Criminal Appeal No. 42 of 1959 decided on 12 10 60. 270 This decision also emphasized that a right to control or supervise is one of the tests for determining the relationship of master and servant. In this context a judgment of the Madras High Court in Palaniappa vs Court of Additional First Class Magistrate, Kulitalai (1) is strongly relied upon on behalf of the appellant. There, the petitioner was the owner of a weaving concern at Karur. He had put up a thatched shed where he had installed a certain number of handlooms and where towels and bed sheets were manufactured. His office consisted of only two clerks, who were this permanent members of his establishment. Some of the residents of the village, most of whom were agriculturists, but who knew waving used to go to the petitioner 's shed when they had e, and when they felt inclined to do to and they were supplied with yarn. These, they wove into bed sheets and towels and they were paid at certain rates for the articles they wove. These persons came in and went out when they liked. On those facts, Balakrishna Ayyar, J., held that they were not "workers" within the definition of the word '"worker" in the . After considering the relevant decisions cited and after distinguishing the cases arising under the Industrial Disputes Act, the learned Judge proceeded to state thus: "An examination of these decision confirms what one was inclined to suspect at the outset, viz., that "employed" is a word with a varying content of meaning and that it signifies different things in different places . . . On the other hand, when we say that X is employed by Y we ordinarily imply that Y remunerates X for his services and that he has a certain measure of control over his time and skill and labour. But the degree and extent of conrlto may be nominal or extensive . . . . (1) I.L.R. , 1009, 1010. 271 In between lie infinite grades of control and supervision. But a certain amount of supervision or control is necessarily implied in the connotation of the word `employed '. " Having said that, the learned Judge graphically describes the relationship between the parties thus: "The worker can come any day he likes, work as long as he likes or as short as he likes and go away. He may work fact or he may work slow. The petitioner cannot tell him that he should work on towels and not on bed sheets or vice versa. . . . And, more important of all the petitioner cannot prevent anybody from working for a competing manufacturer. Come when you like, go when you like, work when you like, stop when you like, work as fast as you like, work as slow as you like, work on what you like or not at all, that the position of the workers vis a vis the petitioner. Such persons cannot, in my opinion, be said to be 'employed ' by the petitioner within the meaning of clause (1) of section 2 of the . " It is not necessary to express our opinion whether the conclusion of the learned Judge on the facts of that case is correct or not. But the principle accepted by him, namely, that a certain amount of supervision or control is necessarily implied in the connotation of the word "employed", has been accepted by this Court in earlier decisions and this decision is only an application of that principle to a different set of facts. The present case falls to be decided on its peculiar facts. As we have pointed out, though there is some laxity in the matter of attendance, it cannot be said that the appellant has no right of supervision or control over the labourers working in the factory or does not supervise to the extent required having regard to the nature of the 272 work done in the factory. All the necessary 'ingredients of the word "employed" are found in the case. The appellant engages the labourers, he entrusts them with work of rolling bidis in accordance with the sample, insists upon their working in the factory, maintains registers giving the particulars of the labours absent, amount of tobacco supplied and the number of bidis rolled by each one of them, empowers the gumasta and supervisor, who regularly attends the factory, to supervise the supply of tobacco and leaves and the receipt of the bidis rolled. The nature and pattern of bidis to be rolled is obviously well understood, for it in implicit in requirement that the rolled in bidis shall accord with the sample. The rejection of bidis found not in accord with the sample is a clear indication of the right of the employer to dictate the manner in which the labourers shall manufacture the bidis. Supposing a worker uses more quantity of tobacco than a bidis is, expected to contain, it cannot be suggested that the supervisor cannot tell him that he shall not do to. If he spoils the leaves, which he in not expected to do, it cannot be said that the labourer cannot be pulled up in the direction. So too, the supervisor can certainly compel the labourers to work in a specified portion of the factory or direct them to keep order a rid discipline in the course of the discharge of their duties. The fact that they cannot take the tobacco outside the factory without the leave of the management shows that they are subject to the supervision of the management. The circumstance that they cannot absent them selves for more than 10 days without the permission of the appellant also is a pointer in that direction. That a labourer is not compelled to work throughout the working hours is not of much relevance, because, for all practical purpose, a labourer will not do so since his wage depends upon the bidis he rolls, and, as he cannot roll them outside the factory, necessarily 273 he will have to do so in the factory. If he absents himself, it is only at his own risk. For all the aforesaid reasons I hold that all the ingredients of the word " 'employed", as laid down by this Court are present in this case, and therefore the labourers are workers within the meaning of section 2(1) of the Act. The next contention of learned counsel for the appellant was that even if the labourers in the factory were workers within the meaning of the Act, section 79 thereof would not apply to them and, therefore, there could not have been any contravention of that section. The material part of section 79 of the Act reads: "Every worker who has worked for a period of 240 days or more in a `factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of (1) if an adult, one day for every twenty days of work performed by him during the previous calendar year;. ". Section 80 says, (1) "For the leave allowed to him under section 79,a worker shall be paid at a rate equal to the daily average of his total full time earnings for the days on which he worked during the month immediately preceding his leave, exclusive of any overtime and bonus but inclusive of dearness allowance and the cash equivalent of the advantage accruing through the concessional sale to the worker of foodgrains and other articles " The argument is that SS. 79 and 80 have to be read together and that 8. 79 cannot be applied to a worker to whom section 80 does not apply. Section 80, the argument proceeds, entitles a worker for 274 leave allowed to him under section 79 to be paid at a rate equal to the daily average of his total full time earnings for the days for which he worked during the month immediately preceding his leave and that as the workers in question had the option to work for the full day or part of the day, the words "full time earnings" would not apply to them. This argument, though at first blush appears to be plausible, on a deeper scrutiny reveals that it is unsound. The following words stand out in section 80(1) full time earning and (ii) days. "Day" has been defined in section 2(e) to mean '"a period of twenty four hours beginning at midnight". It cannot be suggested, and it is not suggested, that " 'full time earnings" for a day means earnings made during all the twenty four hours. Such a contention cannot be raised for the reason that the provision of the restrict the number of hours of work during the day of twenty four hours. Under section 51 of the Act, '"No adult worker shall be required or allowed to work in a factory for more than forty eight hours in one week", and under a 54, "Subject to the provisions of section 51, no adult worker shall be required or allowed to work in a factory for more than nine hours in any day". A combined reading of these two sections indicates that subject to the maximum period of working hours fixed for a week, no worker shall be allowed to work for more than a hours a day. For the purpose of calculation of wages during the leave period under section 80, the full time earnings for a day can be taken to mean the amount earned be a worker for the daily hours of work field for a factory. In the instant case it is admitted that the working hour for the factory are filed and the workers are entitled to work throughout the working hours, though they can leave the factory during those hours if they choose to do so. But they cannot be prevented from working for all the hours fixed for the factory and they are entitled 275 to be paid their wages on the basis of the number of bidis rolled by them. The wages earned by them during the working hours of the factory would be their full time earnings for the day. If so, there cannot be any difficulty for the management to ascertain the rate under B. 80 of the Act for the payment of wages during the leave period, for under that section the management would have to pay at a rate equal to the daily average of their total full time earnings for the days they worked. The factory registers would show the total full time earnings of each worker for the days during the month immediately preceding his leave. The average shall be taken of the earnings of those days and the daily average of those earnings would be the criterion for fixing the wages during the leave period. I cannot, therefore, say that section 79 of the Act by its impact on section 80 thereof makes it inapplicable to a worker of the category with which we are now concerned. This argument, therefore, is rejected. No other question was raised before us. In the result, the appeal fails and is dismissed. By Court. In accordance with the opinion of the majority the appeal is allowed, the order of the Court below set aside and the appellant acquitted. Fine, if paid, will be refunded. Appeal allowed.

The appellant was the owner of a factory manufacturing bidis and one P along with other labourers used to roll bidis in the factory with tobacco and leaves supplied to him by the factory. The following were established facts: (1) There was no contract of service between the appellant and P.(2) He was not bound to and the factory for rolling biding for any fixed hours or period; he was free to go to the factory at any time during working hours and leave the factory at any time he liked. (3) He could be absent from the work any day he liked and for ten days without even informing the appellant. He had to take the permission of the appellant if he was to be absent for more than I O days. (4) He was not bound to roll the bidies at the factory. He could do so at home with the permission of the appellant for taking home the tobacco supplied to him. (5) There was no actual supervision of the work done by him in the factory and at the close of the day rolled bidis were delivered to the appellant. Bidis not up to the standard were rejected. (6) He was paid at fixed rates on the quantity of bidis turned out and there was no stipulating for turning out any minimum quantity of bidis. The Inspector of Factories found that he was not paid the wages for 4 days ' leave which he had earned after having worked for a certain period. The appellant was fined Rs. 101 for contravening the provisions of section 79(11) of the . The questions which arose for decision were whether P was a worker within the meaning of that expression under the Act and whether he was entitled to any leave wages under section 80 of the Act. ^ Held (per Kapur and Raghubar Dayal, JJ.), that the decision of this Court in Birdhi Chand 's Case was distinguishable on facts and could not be applicable to the facts of the present case. The appellant exercised no control and supervision over P. He was not a worker as the three criteria and conditions laid down by this Court in Chintaman Rao 's 250 case for constituting him as such were not fulfilled in the present case. Biardhi Chand Sharma vs The First Civil Judge, Nagpur ; , distinguished. Chintaman Rao vs The State of Madhya Pradesh, ; , applied. Whether the appellant contravened the provisions of sub .(1) of section 79 depended on the proper construction of sections 79 and 80 of the Act. With the terms of the work as they were in the present case there could be no basis for calculating the daily average of the worker 's "total full time earnings" which means the earnings he earns in a day by working full time on that day, the full time to be in accordance with the period of time given in the notice displayed in the factory for a particular day and. therefore the wages to be paid for the leave period could not be calculated nor the number of days for which leave with wages could be allowed be calculated in such a case. The conviction of the appellant under section 92 read with section 79(1) of the Act was wrong. Per Subba Rao, J., dissenting, The question raised in the appeal was directly covered by the judgment of this Court in Birdhi, Chand Sharma case. It could not be said that the appellant had no right of supervision or control over the labourers ill the factory or did not supervise to the extent required having regard to the nature of the work done in the factory. Under section 2(1) of the Act "worker" meant a person employed, directly through any agency whether for wages or not in any manufacturing process. All the ingredients of the word "employed" as laid down by this court were present in this case and therefore the labourers were workers within the meaning of section 2(1) of the Act. Birdhi Chand Sharma vs First Civil Judge, Nagpur. ; , Chaintaman Rao vs State of M.P.[1958] section C. R. 1340, Dharangadhara Chemical Works vs State of Saurashtra, ; , State of Kerala vs V. M. Patel, and palaiappa vs Court of Additional First Class Magistrate, Kulitalai I. L. R. , considered. For the purpose of calculation of wages during the leave period under section 80, the full time earnings for a day could be taken to mean the amount earned by a worker for the daily hours of work fixed for a factory. In the instant case the workers were entitled to work throughout the fixed working hours of the factors though they could leave the factory at any time during those hours and hey 251 were entitled to be paid their wages on the basis of the number of the bidis rolled by them. The wages earned by them during the working hours of the factory would be no their full time earning for the day. There could, therefore, be no difficulty in ascertaining the rate under section 80 of their wages during, the leave period, for under that section the workers would have to be paid at a rate equal to the daily average of their total full time earnings for the days they worked.

Civil Appeal No. 34 of 1954. Appeal from the judgment and decree dated July 2, 1951, of the Punjab High Court in Regular First Appeal No. 269 of 1945. N. section Bindra, and Harbans Singh, for the appellant. Gopal Singh, for the respondents. November 3. The Judgment of the Court was delivered by WANCHOO, J. The suit out of which the present appeal arises has had a chequered history. It was filed as far back as June 1943, the plaintiff being section Balwant Singh (hereinafter referred to as the respondent). The main defendants were Kesar Singh and Jaswant Singh, of whom Kesar Singh will be referred to as the appellant hereinafter. The suit was with respect to a house known as bunga Maharaja Sher Singh which is situate outside the tank around Sri Harmandir Saheb (hereinafter referred to as the Golden Temple) in Amritsar. The case of the respondent was that he and his uncle who was made a defendant to the suit were managers of this bunga which was wakf property and that they and their ancestors had been in possession of it throughout. There were proceedings before the Sikh Gurdwaras Tribunal established under the Sikh Gurdwaras Act, No. VIII of 1925, (hereinafter referred to as the Act) in 1933 with respect to this bunga. The proceedings arose because a claim was put forward that the bunga was the property of the Golden Temple. In those proceedings the appellant and the other defendant claimed the bunga. The respondent also made a 327 claim to the bunga. The proceedings were all consolidated and it was decided that the bunga was not the property of the Golden Temple; the claims of the appellant and the other defendant were also dismissed and the Tribunal held that the respondent and his uncle had the right to manage and supervise the bunga and were its managers. There were appeals to the High court from that decision by the appellant and the other defendant which were dismissed with the result that the status of the respondent and his uncle as determined by the Tribunal was upheld. Thereafter the respondent along with his uncle filed a declaratory suit against the appellant and the other defendant. In that suit they were ordered to file a suit for possession. Consequently the present suit was filed for possession and ejectment of the appellant and the other defendant. The case for ejectment was based on the ground that the appellant and the other defendant were in possession of the bunga without any right. They had been asked to deliver possession to the respondent but refused to do so and continued to treat the bunga, which was wakf property as their personal property. The respondent therefore did not desire to keep the appellant and the other defendant as servitors to look after the bunga as they were claiming rights adverse to the wakf and consequently prayed for their ejectment and delivery of possession of the bunga to him and his uncle. The suit was resisted by the appellant and the other defendant and it was contended that the respondent was not a descendant of Maharaja Sher Singh and was therefore not entitled to the management of the bunga. It was denied that the bunga was wakf property. It was also denied that the respondent and his uncle had ever anything to do with the bunga or were ever in possession of it as 328 managers. It was further alleged that any decision of the tribunal against the appellant had no effect as the tribunal had no jurisdiction to give an decision and in any case the tribunal had given no decision in favour of the respondent and his uncle. Further even if any decision was given in favour of the respondent and his uncle by the tribunal, it was not binding on the appellant as he was no party to those proceedings. It was also claimed that the appellant was the owner of the bunga and in any case even if the bunga was wakf property the appellant was its hereditary manager and was entitled to its possession and could not be ejected by the respondent. Finally, adverse possession was claimed against the respondent who was alleged to have never been in possession within 12 years before the suit was filed and in any case as the respondent 's application under section 25A of the Act had been dismissed in July 1935 he had no right to file a suit for possession thereafter. On these pleadings, eight issues were framed by the trial court, which are as below: 1. Whether the bunga in dispute is a wakf property founded by Maharaja Sher Singh, or any descendant of Maharaja Sher Singh? 2. Is the plaintiff a descendant of Maharaja Sher Singh, and is therefore entitled to get possession of the bunga in dispute as a manager? 3. Is the plaintiff entitled to bring this suit alone? 4. Is the suit within time? 5. Is the suit barred under section 92 Civil Procedure Code? 6. Are the defendants debarred from denying the plaintiff 's title in view of the judgments. 329 of the Lahore High Court and the decision of the Sikh Gurdwaras Tribunal? 7. Has the plaintiff relinquished his right and what is its effect? 8. Relief? In the trial court, the parties agreed that the decision might be given only on issues 3 to 7 and issues Nos. 1 and " might be left undecided. Consequently, the trial court Proceeded to decide issues 3 to 7 only. It held on issue No. 3 that the respondent was entitled to bring the suit alone. On issue No. 4, the trial court held that the suit was barred by time. Issue No. 5 was not pressed and was therefore decided against the appellant. On issue No. 6 the trial court was of the view that it was not necessary to give any finding on it in view of the finding on the question of limitation; even so it held that the defendants were debarred from denying the plaintiff 's title in view of the judgment of the Lahore High Court and the decision of the Tribunal. On issue No. 7 it held that in view of the decision of the tribunal and judgment of the High Court it could not be said that the respondent had relinquished his rights. In the result, the suit was dismissed on the ground of limitation. The respondent then went in appeal to the Punjab High Court. The High Court held on the question of limitation that the suit was not barred by time. It then referred to the decision of the tribunal which had held that the bunga was wakf property founded by Maharaja Sher Singh and held that this decision of the tribunal was binding and conclusive. It was of the view that the question whether the respondent was the descendant of Maharaja Sher Singh and therefore entitled to obtain possession of the bunga which was the subject matter of issue No. 2 should have been decided. It therefore accepted the appeal and set aside the order of the trial court on the question of limitation 330 and remanded the case for the decision of issue No. 2 as framed by the trial court and further framed two additional issues and directed the trial court to decide them also. These additional issues were: 1. Was Jaswant Singh a bungai or a servitor of the plaintiff and defendant No. 3 or their ancetors? 2. Can the plaintiff dispossess the defendants on any of the grounds specified in paragraph 4 of the plaint? On remand the trial court held against the respondent on issue No. 2. Its finding was that it had not been proved that the respondent was the eescendant of Maharaja Sher Singh and therefore entitled to get possession of the bunga in dispute as manager. On the first additional issue, the trial court found that the appellant and the other defendant were servitors or bungais. On the second additional issue it was found that a bungai or servitor if he denies the title of the rightful owner on whose behalf he manages the property forfeits his rights to retain the property or to continue as servitor, and as the appellant and the other defendant had set up a title adverse to the respondent, they would be liable to ejectment on the ground specified in para 4 of the plaint, if the respondent is the rightful owner, whether as trustee or otherwise, of the bunga. On receipt of these findings, the appeal was heard again, this time by another Bench of the High Court, The High Court pointed out that issue No. 6 had not been decided on the earlier occasion and took the view that if issue No. 6 were decided in favour of the respondent it would not be necessary to go into the question whether the respondent was the descendant of Maharaja Sher Singh and therefore entitled to sue for ejectment. The High Court therefore addressed itself to the decision of 331 issue No. 6 and held that in view of the judgment of the Lahore High Court and the decision of the tribunal, the appellant and the other defendant were debarred from denying the respondent 's title as a descendant of Maharaja Sher Singh. In that view of the matter it held that the suit must succeed as the question of limitation had been decided against the appellant and the other defendant and it was not open to go into the question whether the respondent was a descendant of Maharaja Sher Singh and therefore entitled to maintain the suit. The appeal was therefore allowed and the suit was decreed. The appellant then applied for leave to appeal to this Court, which was granted; and that is how the matter has come up before us. The appeal came up for hearing before this Court in 1958. This Court then took the view that it was difficult to decide the appeal satisfactorily without having a finding on the essential issue, namely, whether the plaintiff was a descendant of Maharaja Sher Singh and therefore entitled to get possession of the bunga in dispute as a manager. This Court therefore directed the High Court to record a finding on issue No. 2 and also on the two additional issues framed by the High Court when the remand was made on an earlier occasion. The appeal has now come up for hearing again after the findings of the High Court, which are that the respondent has not been proved to be the descendant of Maharaja Sher Singh and that the appellant and the other defendant were in possession of the bunga as bungais or sewadars and that they were liable to ejectment because they had denied the title of the rightful owner on whose behalf they were managing the property. In effect the High Court confirmed the findings of the trial court on remand. Before we go into the effect of the findings now submitted by the High Court on the direction of this court, it is in our opinion necessary to decide issue No. 6, for if that issue is decided in favour of 332 the respondent it will not be open to the appellant or the other defendant to question that the respondent was the descendant of Maharaja Sher Singh and consequently had the right to maintain the suit. That brings us to the consideration of the effect of the decision of the tribunal and the judgment of the Lahore High Court in appeal therefrom, which in its turn requires a consideration of the provisions of the Act. The Act was passed to provide for the better administration of certain Sikh Gurdwaras and for inquiries into matters and settlement of disputes connected therewith. Section 3 (1) of the Act provides for forwarding by any Sikh or any present office holder of a Gurdwara, specified in Sch. I, of a list of all rights, titles or interests in immovable properties situate in Punjab and in all monetary endowments yielding recurring income or profit received in Punjab which he claims to belong, within his knowledge, to the gurdwara along with the name of the person in possession of any such right, title or interest. On receiving such lists, the State Government has to publish, inter alia, under section 3 (2) a consolidated list in which all rights, titles and interests in such properties as are described in sub s.(1) are included and also to send by registered post a notice of the claim to each of the persons named therein as being in possession of such right, title or interest. Section 5 (1) then provides that any person may forward to the State Government a petition claiming a right, title or interest in any such property included in such consolidated list within a certain time of its publication. Sub section (3) then lays down that if no claim is made under section 5 (1) within the time limited thereby, the State Government shall publish a notification declaring that no such claim has been made with respect to the property notified under section 3 (1). Sections 7 and 10 make similar provisions with respect to gurdwaras which are not included in Sch. I to the Act; but we 333 are not concerned with them in the present appeal for the Golden Temple is included in Sch. I and sections 3 and 5 apply to it. Section 12 then provides for setting up of a tribunal. Section 14 gives power to the State Government to forward to the tribunal all petitions received by it under the provisions of section 5 and other sections and the tribunal has to dispose of such petitions in accordance with the provisions of the Act. Section 15 is important and may be read in extenso "(1) In disposing of any matter in which it has jurisdiction a tribunal may order any dispute arising therefrom to be dealt within one proceeding separately or more such disputes than one to be dealt with in one proceeding, and may, by public advertisement or otherwise, enquire if any person desires to be made a party to any proceeding, and may join in any proceeding any person who it considers ought to be made a party thereto. (2) The tribunal may order any person to submit within a fixed time a statement in writing setting forth the nature of his claim or objection and the grounds thereof. (3) If any person fails to comply with an order passed under the provisions of subsection (2) and duly notified to him, the tribunal may decide the matter in dispute against him, provided that the tribunal may at any time extend the time fixed by its order for the submission of the statement if the person satisfies it that he had sufficient cause for not submitting the statement within the time fixed. (4) A tribunal may pass any such order as to costs of a proceeding as a court might pass under the provisions of the Code of Civil Procedure, 1908. " 334 Then comes section 25A which lays down that when it has been decided under the provisions of the Act that a right, title or interest in immovable property belongs to a notified Sikh Gurdwara, or any person, the Committee of the Gurdwara concerned or the person in whose favour a declaration has been made may, within a period of one year from the date of the decision or the date of the constitution of the Committee, whichever is later, institute a suit before a tribunal claiming to be awarded possession of the right, title or interest in the immovable property in question as against the parties to the previous petition, and the tribunal shall, if satisfied that the claim relates to the right, title or interest in the immovable property which has been held to belong to the Gurdwara, or to the person in whose favour the declaration has been made, pass a decree for possession accordingly. Section 26 then inter alia lays down that when it has been decided, under the provisions of the Act, that a right, title or interest in immovable property belongs to a Notified Sikh Gurdwara or when a right, title or interest in such property has been included in a list published under the provisions of section 5 (3), the Collector of the district in which the property is situated shall, on application being made to him on this behalf and after making such enquiry as he may deem proper into the fact of such decision or inclusion, cause an entry to be made in the records of rights, if any, of the estate in which the property is situated recording the gurdwara as the owner of the right, title or interest in accordance with the provisions of the Punjab Land Revenue Act, 1887. Section 28 then provides for a suit for possession in respect of properties in which no claim has been made under section 5 or section 10. Section 34 (1) gives a right of appeal to the High Court to any party aggrieved by a final order passed by the tribunal determining any matter decided by it under the provisions of the Act. Section 36 and 37 are important and may be read in extenso. 335 "36. No suit shall lie in any court to question anything purporting to be done by the State Government or by a tribunal in exercise of any powers vested in it by or under this Act." "37. Except as provided in this Act no court shall pass any order or grant any decree or execute wholly or partly, any order or decree, if the effect of such order, decree or execution would be inconsistent with any decision of a tribunal, or any order passed on appeal therefrom, under the provisions of this Part. " It is clear therefore from the scheme of the Act that it gives jurisdiction to the tribunal to decide all claims to properties which are claimed to be the properties of a Sikh Gurdwara mentioned in Sch. I to the Act. It is true that where a property in notified in the list under section 3 each person who has a claim to that property has to make a separate claim on his own behalf which is forwarded to the tribunal for decision. It is clear however from the provisions of section 15 that where a tribunal is dealing with a property which is claimed to belong to a Sikh Gurdwara and in respect of which counter claims have been made by other persons, it has jurisdiction to decide to whom that property belongs, whether to the Sikh Gurdwara or to any other person claiming it and for that purpose it can consolidate the proceedings resulting from different claims to the same property so that all dispute with regard to that property can be decided in one consolidated proceeding. Further it has the power under section 15 to inquire by public advertisement or otherwise if any person desires to be made a party to any proceeding and may join in any proceeding any person who it considers ought to be made a party there to. Where therefore a number of claims have been made under section 5 to the same property which is claimed under section 3 336 to belong to a Sikh Gurdwara the tribunal can consolidate all such claims under section 15 and treat all the claims as one proceeding. Where therefore the tribunal consolidates the claims in one proceeding each claimant even though he had made a claim for himself as against the Sikh Gurdwara would be entitled under section 15 to contest the claim not only of the Sikh Gurdwara but of any other person who is making a rival claim to the property as against the Sikh Gurdwara. It is also clear from section 25A that in deciding the claims made under section 5 it is open to the tribunal not only to decide whether the property to which claims have been made belongs to the Gurdwara but also to decide whether it belongs to any of the claimants. It seems therefore that the Act has given full power to the tribunal to decide between the rival claims of the Sikh Gurdwara and other claimants under section 5 and empowers it not only to give a decision as to the rights of the Sikh Gurdwara but also of other claimants. Further there is provision in section 34 of the Act for appeal to the High Court by any party aggrieved by a final order passed by a tribunal in matters decided by it under the provisions of the Act. The words in section 34 (1) are very wide and where claims are consolidated in one proceeding under section 15 and the claim of the Gurdwara and the rival claims of various claimants under section 5 with respect to one property are decided in a consolidated proceeding, it is clear that any party who was party to the consolidated proceeding would be entitled to appeal against the order of the tribunal if it went against it and was in favour of the Sikh Gurdwara or of any other claimant in the consolidated proceeding. Section 36 thereafter bars a suit in any court to question any decision of a tribunal in exercise of any powers vested in it by or under the Act. Section 37 bars any court from passing any order or granting any decree or executing wholly or partly any order or decree, if the effect of such order, or decree or execution would be 337 inconsistent with any decision of a tribunal or any order passed on appeal therefrom under the provisions of the Act. It is on this scheme of the Act that we have to see whether it is open to the appellant and the other defendant to raise the question in the present suit that Balwant Singh was not the descendant of Maharaja Sher Singh and therefore not entitled to maintain the present suit. It is necessary for this purpose to examine the order of the tribunal which was made on June 22, 1933, by a majority of two to one. It is not in dispute that this bunga was notified under section 3 of the Act as property claimed by the Golden Temple. This notification led to four claims with respect to this bunga, namely, by Jaswant Singh who was a party to the suit from which the present appeal has arisen, Darbara Singh and others with whom we are not concerned, Kesar Singh appellant and Balwant Singh respondent. The tribunal consolidated all the four claims under section 15 of the Act and dealt with the matter in one proceeding. The case of Jaswant Singh was that he was in possession of the first storey of the bunga by virtue of his perpetual rights of possession and management in the bunga as bungai. Kesar Singh 's case was that he was in possession of two rooms on the first and second floors of the bunga. He did not define what his right was but denied that the bunga was wakf. Balwant Singh 's case was that the bunga was built by his ancestors for spiritual and wordly benefit of their offspring and was in his possession and that of his ancestors and should be declared to be the property of his family. All these three claimants denied that the Golden Temple had any kind of right in the bunga. In the consolidated proceeding therefore the tribunal had to decide firstly whether the bunga was the property of the Golden Temple. If it decided that, all the claims would necessarily fall 338 through. But if it held that the bunga was not the property of the Golden Temple it had to adjudicate on the respective claims of Jaswant Singh, Kesar Singh and Balwant Singh. By majority, the tribunal held that the bunga was not the property of the Golden Temple. It therefore had to decide to which of the three claimants under section 5, if any, the bunga could be held to belong. It negatived the claims of Kesar Singh and Jaswant Singh. As to Balwant Singh 's claim it held by a majority that Balwant Singh had no personal or private right in the bunga. It further held that the bunga was wakf property dedicated to the pilgrims to the Golden Temple and that the descendants of Maharaja Sher Singh were the managers of the bunga. It is clear from the decision of the majority of the tribunal that the descent of Balwant Singh from Maharaja Sher Singh was not disputed before the tribunal either by the Golden Temple or by any other party. It is clear therefore that the tribunal had jurisdiction to decide the rights to the bunga, as it was one of the properties notified under section 3. It had also the jurisdiction to determine all claims made under section 5 and it consolidated all the claims into one proceeding and decided the rights of the claimants and the Golden Temple in that Proceeding. Now the respondent was claiming in those proceedings that he was the owner of the bunga as the descendant of Maharaja Sher Singh. Neither the Golden Temple nor the other claimants seem to have challenged the claim of the respondent before the tribunal on the ground that he was not a descendant of Maharaja Sher Singh and therefore had no right to maintain the claim. The whole proceeding before the tribunal was conducted on the basis that the respondent was a descendant of Maharaja Sher Singh and the only question was whether as such descendant he had a right to the property. The tribunal nagatived his claim of ownership of the bunga and held that it was wakf property under the management of the descendants or Maharaja Sher Singh. 339 It has been urged that the order of the tribunal does not mention in the operative part that Balwant Singh was entitled to manage the property as the descendant of Maharaja Sher Singh and this shows that though the tribunal was of opinion that the descendants of Maharaja Sher Singh were entitled to manage the bunga it was not accepting Balwant Singh 's claim as such descendant and there was thus no decision in favour of Balwant Singh. We cannot accept this contention, for if Balwant Singh was not a descendant at all of Maharaja Sher Singh and if this point was raised by anybody before the tribunal his claim would have failed on the simple ground that he was nobody to put forward the claim of the descendants of Maharaja Sher Singh. The reason why the tribunal used the words "that the descendants of Maharaja Sher Singh are managers of the bunga" appears to be that at that time the father of Balwant Singh was alive and in the presence of his father Balwant Singh could not claim a right to manage the bunga. Therefore the tribunal used neutral words, namely, "the descendants of Maharaja Sher Singh are managers of the bunga", instead of mentioning Balwant Singh as the manager of the bunga. This is clear from an earlier part of the decision of the tribunal where in dealing with the question of ownership of Balwant Singh, it has remarked that "it is hard to see that Balwant Singh has any personal or private rights over the bunga in the presence of his father Raghbir Singh". Though therefore the respondent was held by the majority of the tribunal, not to have rights in himself because his father was alive the tribunal nevertheless went into the question of the rights of Maharaja Sher Singh 's descendants at the instance of Balwant Singh treating him as a representative of the descendants. This is also clear from the form in which the issue No. 3 was framed, namely, "was the bunga in dispute built by Maharaja Sher Singh, ancestor of Balwant Singh petitioner in 1629, and has been in his possession ? What rights as he been exercising over it ?" It is 340 clear therefore that before the tribunal Balwant Singh 's claim as a descendant of Maharaja Sher Singh was not challenged by the appellant or the other defendant; and the tribunal found in favour of the descendants of Maharja Sher Singh at the instance of Balwant Singh. It was in our opinion open to the appellant and the other defendant to challenge this finding in favour of the descendants of Maharaja Sher Singh at the instance of Balwant Singh under section 34 of the Act as all the claims were consolidated under section 15 and treated as one case relating to one property. But though the appellant and the other defendant went in appeal to the High Court they do not seem to have challenged the finding of the tribunal in favour of the descendants of Maharaja Sher Singh. Further the Golden Temple also went in appeal; but it also did not challenge the decision in favour of the descendants of Maharaja Sher Singh. That decision has therefore become final and according to that decision the descendants of Maharaja Sher Singh are the managers of this bunga. That decision was given at the instance of the respondent whose claim in those proceedings based on his being a descendant of Maharaja Sher Singh was never challenged on the ground that he was not the descendant of Maharaja Sher Singh. The question therefore that arises is whether in view of sections 36 and 37 of the Act it would be open to any court now to give a decision which will go against what has been held in that decision of the Tribunal. If a court cannot give a decision which would go against the decision of the Tribunal in 1933, it would obviously be not open to a party to those proceedings to raise any question which would have the effect of questioning the decision of the Tribunal. Section 36 bars any court from questioning anything done by a Tribunal in exercise of the powers vested in it by or under the Act. Section 37 bars any court from passing any order 341 or granting any decree or executing wholly or partly any order or decree if the effect of such order, decree or execution would be inconsistent with any decision of the tribunal or any order passed on appeal therefrom under the provisions of the Act. Now the decision of the tribunal which became final as it was not appealed from either by the Golden Temple or by the appellant or the other defendant was that the bunga was wakf property under the management of the descendants of Maharaja Sher Singh and this decision was given at the instance of the respondent who claimed in those proceedings to be a descendant of Maharaja Sher Singh and this claim of his to be a descendant of Maharaja Sher Singh was never disputed. If therefore the Court now holds at the instance of the appellant or the other defendant that the respondent is not the descendant of Maharaja Sher Singh it will be questioning the decision of the tribunal and passing an order or granting a decree which would be inconsistent with the decision of the tribunal. Section 36 and 37 bar any such order or decree by the court and therefore the appellant and the other defendant are naturally debarred from raising point the decision of which is barred under sections 36 and 37 of the Act. We are therefore of opinion that the view taken by the High Court in its judgment after remand on issue No. 6 is correct and it is not open to the appellant to raise the question whether the respondent is a descendant of Maharaja Sher Singh and as such entitled to maintain the present suit. This brings us to the question of limitation, which was decided by the High Court on the earlier occasion when the remand was made. The case of the appellant in that connection is that he was in adverse possession and the respondent had been out of possession for over 12 years before the suit was filed in 1943 and therefore the suit should be dismissed as barred under article 144 as well as article 142 342 of the Limitation Act. The appellant contends that the plaint itself shows that the respondent had been dispossessed more than 12 years before the present suit was filed and therefore the suit must fail on the ground of limitation. We agree with the High Court however that a careful reading of paras. 3 and 4 of the plaint shows that the respondents case was that he and his uncle were managers of the bunga as descendants of Maharaja Sher Singh and that the appellant and the other defendant were in possession as their servants or servitors. But these servants had started denying the title of the respondent and his uncle they do not want to keep them any longer in their service. They therefore filed the suit for ejectment of these servants and for possession of the property. The High Court therefore was right in the view it took that it was a case of permissive possession arising in favour of the appellant and the other defendant. Whatever may be the position about the actual possession, it appears from the decision of the tribunal that the claim of the appellant and other defendant before the tribunal in 1933 was that they were bungais i.e. servitors; and this was also the view of the High Court in the appeal from the decision of the tribunal where the High Court said that "no doubt Kesar Singh, his father and grandfather have been Bungais of the bunga, but there is no reliable evidence of their having set up a title adverse to the institution or that the nature of this bunga is exceptional." Similarly Jaswant Singh also claimed to be a mere bungai before the tribunal by virtue of his father being adopted by Natha Singh who was undoubtedly a bungai. In these circumstances from the decision of the tribunal in favour of the respondent in 1933, it appears that no hostile title adverse to the respondent was ever set up by the appellant and the other defendant before that decision. In consequence it cannot be said that adverse possession over 12 years has been established 343 before June 1, 1943 when the present suit was filed. As originally the possession of the appellant and the other defendant was clearly permissive, there can be no question of the application of article 142 in the present case and the appellant could only succeed if he could prove adverse possession under article 144 for over 12 years. The decision of the High Court on the question of limitation is correct. Lastly, it is urged that the respondent had applied under section 25A to the tribunal but allowed that suit to be dismissed for default and therefore it was not open to him to file the present suit for possession. It is enough to say that though this point was framed in the written statement no issue was framed with respect to it by the trial court. When the matter was raised in the High Court on the first occasion it held that as no issue had been framed and no evidence had been led by the parties as to whether the cause of action was or was not the same and no copy of the plaint in the earlier proceeding had been filed the question whether the present suit was barred by virtue of O.IX. of the Code of Civil Procedure could not be gone into and it must be held that it was not barred under O. IX. In view of what the High Court has said we are of opinion that it is not open to the appellant to raise this point before us when he had failed to get an issue framed on it and no evidence was led in that behalf. As the appellant cannot challenge that the respondent is the descendant of Maharaja Sher Singh the respondent would have a right to maintain the suit. Further as the appellant and the other defendant are servitors and they have undoubtedly set up a title after the decision of the tribunal adverse to the respondents 's right as found by the tribunal, the respondent is entitled to eject the appellant and the other defendant, for servitors cannot claim to remain in possession after they set up an adverse title with respect to the property of 344 which they are servitors. In view of our decision on issue No. 6, it is unnecessary to consider issue No. 2 on which a finding was called for by this Court by its interlocutory judgment in 1958. The appeal therefore fails; there would be no order as to costs. Appeal dismissed.

In 1933 there were proceedings before the Sikh Gurdwaras Tribunal under the Sikh Gurdwaras Act, 1925, for determining whether the bunga in suit was the property of the Golden Temple. In these proceedings K and J claimed to be owners of the bunga and claimed that he was the descendant of Maharaja Sher Singh and as such was entitled to the bunga as a manager. The Tribunal rejected the claims of the Golden Temple and of K and J and held that the bunga was wakf property under the management of the descendants of Maharaja Sher Singh. Subsequently, B brought a civil suit for possession of the bunga by ejectment of K and J on the ground that they being servants or servitors of the wakf had forfeited their right of residence as they were claiming rights adverse to the wakf. K and J resisted the suit mainly on the grounds that was not competent to maintain the suit as he was not a descendant of Maharaja Sher Singh and that they had prescribed title by adverse possession. ^ Held, that sections 36 and 37 of the Act barred K and J from raising the question before the Civil Court whether B was a descendant of Maharaja Sher Singh. The Act had given full powers to the Tribunal to decide, not merely the claim of the Sikh Gurdwara, but also of all the rival claimants before it. Section 36 barred any court from questioning anything done by the Tribunal in exercise of its powers under the Act. Section 37 barred any court from passing any order or decree or executing any order or decree if the effect of doing so was inconsistent with decision of the tribunal. The decision of the Tribunal that the bunga was wakf property and that the descendants of Maharaja Sher Singh were the managers had become final. The claim of B that he was a descendant of Maharaja Sher Singh was never challenged before the Tribunal and its decision was given at the instance of B. Held, further, that the suit was not barred by limitation either under article 142 or article 144 of the Limitation Act. K and 326 J were in possession as servants or servitors and their possession was permissive. From the decision of the Tribunal it was clear that no hostile title was set up by K and J against B at any time before the proceedings of 1933, as such the suit which was filed in 1943 could not be barred by limitation.

Appeal No. 93 of 1952. Appeal from the Judgment and Decree dated the 20th January, 1950, of the High Court of Judicature at .Calcutta (Das and Gupta JJ.) in Appeal from Original Decree No. 141 of 1940 arising out of Judgment and Decree dated the 8th May, 1940, of the Court of the Subordinate Judge, 1st Court of Zillah If owrah in Title Suit No. 38 of 1948. N.C. Chatterjee (A. N. Sinha, with him) for the appellant. Panchanan Ghosh (Syama Charan Mitter and A.K. Dutt, with him) for the respondent. January 28. The Judgment of the Court was delivered by DAS J. This is an appeal by the plaintiff ' in an ejectment suit. His case was that defendant No. I Pratul Chandra Ghose was a Ticca tenant of premises Nos. 2 and 3, Watkin 's Lane, Howrah, comprising an area of I Bigha 19 Cottahs of land on a rent of Rs. 78 per annum under the landlords Kumar Sarat Kumar Roy and Bibhuti Bhusan Chatterjee, proform a defendants Nos. 2 and 3, that the plaintiff took a Mourashi Mokarari lease from these landlords on the 23rd September, 1937, and thereby became the immediate landlord of the said defendant and that the teancy was determined by a notice to quit dated the 7th October, 1937. The trial Court, amongst other 932 things, found as a fact that the tenancy of the defendant Pratul Chandra Ghose was permanent, heritable and transferable and was not liable to be determined by notice. The plaintiff preferred an appeal to the High Court but the High Court dismissed that appeal holding, amongst other things, that the finding of the trial Court as to the nature of the tenancy was correct. The plaintiff has now come up on appeal before us after getting a certificate from the High Court that it is a fit case for appeal to this Court. Relying on the decision of the Privy Council in Dhanna Mal vs Moti Sagar(1) Shri N. C. Chatterjee appearing on behalf of the plaintiff appellant contends that the present appeal is not concluded by the concurrent finding of the Courts below that the tenancy was permanent because that question was one of the proper inference in law to be deduced from the facts as found by the Courts below. The learned counsel has, therefore, taken us through. the evidence mostly documentary, as to the nature of the tenancy. The earliest document referred to is Exhibit P/11, being a conveyance executed in 1226 B.S.1819 1820 by Sheikh Manik and another in favour of Mrs. Cynthia Mills Junior. How the vendors had acquired their title is not known. By that deed of sale the vendors, for a money consideration,, conveyed their interest in the lands described as Jamai lands to the purchaser who, on payment of rent of Rs. 480 per kist, was to "go on possessing and enjoying the same with great felicity down to your sons and grandsons etc. , in succession by constructing houses and structures." Mrs. Cynthia Mills died some time before October, 1855, and her son John Henry Mills who had succeeded her sold the premises to one Mrs. Sabina Love by a conveyance Exhibit P/10 dated the 29th October, 1855. It appears from that deed that by that time a tank with masonry steps had been excavated on the lands which were described as a plot of rentpaying garden land. The consideration for the sale (1) (1927) L. R. 54 1. A. 178. 933 was Rs. 1,000. The following provisions of the sale deed are of importance: "From this date being entitled to make gift and sale of the said property, you do bring into your own possession the said lands etc., and on paying annually to the Maliks Zemindars Rs. 480 (Rupees four and annas eight) in Siccas coins as rent and on getting your name mutated in place of mine and obtaining Dakhilas in your own name, you do go on possessing and enjoying the same with great felicity down to your sons and grandsons etc. , in succession. " By a conveyance Exhibit P/9, dated the 10th October, 1856, Mrs. Sabina Love transferred the premises to one Francis Horatio Dobson. The premises were there described as "garden land held under Mourashi Patta" which Patta has since been held to be a spurious document in a subsequent litigation. It appears from this document that Mrs. Cynthia Mills had excavated a tank and constructed a pucca ghat and laid out a garden and that on her death her son and heir John Henry Mills came into possession of the land and that he had sold the premises to Mrs. Sabina Love and that after her purchase Mrs. Sabina Love had enclosed the said lands and had manufactured bricks with the earth of the land she purchased. The consideration for this conveyance was Rs. 1,200. It provided as follows : " From to day you become the owner of the said lands with powers of making gift and sale. On keeping the said lands together with the tank with all interests therein in your possession and under your control, and on paying according to the previous Patta the Mokarari annual rent of Rs. 480 in Sicca coins into the Sherista of the Zemindar and on having the previous name struck off from the landlord 's Sherista and getting your own name recorded therein, you do go on enjoying and possessing the same with great felicity down to your sons, grandsons etc. , in succession . " On 10th Jeshta 1266 B.S. corresponding to 23rd May, 1859, a notice under sections 9 and 10 of Regulation V of 1812 was issued by the then Zemindars Rani 934 Lalanmoni and Raja Purna Chandra Roy. It was ,addressed to " Mrs. Cynthia Mills Junior, Sarbarahkar Mr. Dobson, of Salkhia. " It rail as follows: " This is to inform you that you are in. possession of I Bigha 19 Cottas of lands of different kinds as per the boundaries given below as recorded in the Mal Department in the said village for which according to your own statement you are paying a yearly rental of Rs. 4126. But you have taken no settlement in respect thereof from our estate (sarkar). Now on fixing the annual Jama of the said lands according to the prevailing rate as per Jamabandi at Rs. 137 8 0 a year, fifteen days ' notice is given to you under the provisions of sections 9 and 10 of Regulation V of 1812 and you are hereby informed that within the said period you should appear before, our Zamindary Cutchery and accept a Pottah after submitting a Kabuliyat according to the practice in respect of the land and Jama. In default, after the expiry of the said period action will be taken according to law, and thereafter no plea shall be entertained. " The requisition not having been complied with, the landlords evidently filed a suit being Suit No. 590 of 1859. The pleadings in this suit are not on the record. On 21st September, 1860, the Principal Sudder Amin delivered his judgment, Exhibit 24. It appears from that judgment that the following two issues had been framed: " 1. Whether the plaintiffs have served notice on the other party for assessment of Jama ? 2. Whether a Jama can be assessed in respect of the disputed lands; if so at what rate?" The Principal Sudder Amin overruling the objection of the defendants held that the landlords had full power to assess the rent and accordingly he fixed the rent at Rs. 2 per Cotta which worked out at Rs. 78 in respect of the entire land. There was an appeal from that decision which, however, was dismissed by the judgment Exhibit Z (2) delivered on the 18th March, 1862 . The Mourashi Patta relied upon was rejected as 935 it was not registered and appeared, on examination, to have been newly written and filed. Thereafter the landlord filed a suit for rent of the disputed lands# against Dobson and Exhibits Z and Z (1) are the certified copies of the judgment and order passed thereon. On the 29th May, 1866, Dobson executed two mortgages (Exhibits P/6 and P/7) in favour of De Rozario and John Dominic Freitas for Rs. 4,000 and Rs, 2,000 respectively. The two re conveyances dated 29th February, 1874, and 12th March, 1874, are also on the record. On 6th March, 1874, Dobson sold the premises to Henry Charles Mann by a deed which is Exhibit P/5. The consideration for the sale was Rs. 9,500. It appears from this deed that by that time there were two brick built dwelling houses on the property which came to be numbered as Nos. 2 and 3, Watkin 's Lane. On 11th September, 1883, Henry Charles Mann sold the premises to George Jones for Rs. 10,000: vide Exhibit P/4. In both those sale deeds the transferee is granted a heritable right forever. In the assessment books of the Howrah Municipality (Exhibits 22 series) the interest of George Jones is described as Mourashi. In the landlord 's Sherista the nature of the tenancy is not stated and Dobson continues to be the recorded tenant (Exhibit D series). There was, however, no column. in the rent receipts to indicate the status of the tenant. It appears that on the death of George Jones the estate came into the hands of the Administrator General of Bengal representing the estate of George Jones. In the rent receipts of Dighapatia Raj the rent is said to be "received from Jones Administrator General of Bengal." In May, 1931, the plaintiff and the Administrator General of Bengal entered into an agreement for sale of premises No. 2, Watkin 's Lane, being a portion of the premises in question, for a sum of Rs. 10,001 and Rs. 1,001 was paid by the plaintiff as and by way of earnest money. The landlords having declined to subdivide the ground rent between the two portions of the premises, namely, Nos. 2 and 3, Watkin 's Lane, and a portion of the Premises No. 2, Watkin 's Lane, having fallen down the 936 agreement for sale appears to have fallen through. On the 4th June, 1932, the plaintiff suggested that a lease for 20 years should be granted which was refused by the Administrator General, Bengal. Then there was some negotiation between the plaintiff and the Administrator General of Bengal for the sale of both the premises, Nos. 2 and 3, Watkin 's Lane, to the plaintiff for a sum of Rs. 12,500. The plaintiff on 9th April, 1933, sent a draft deed of sale (Exhibit 15) for the approval of the Administrator General of Bengal describing the premises as a Mokarari Mourashi homestead. On 21st April, 1933, Dighapatia Raj Estate wrote to the Administrator General. of Bengal saying that the tenancy was a Ticca one. On 6th June, 1933, the Administrator General of Bengal declined to approve the draft as drawn. After some further proposal by the plaintiff for a long lease he declined to purchase the property on the ground that the Administrator General of Bengal had not a good marketable title. Nothing having come out of the negotiations between the plaintiff and the Administrator General of Bengal the latter in September, 1936, invited offers for sale of the lands (Exhibit B). The defendant No. I made the highest offer of Rs. 12,251. and this was accepted by the Administrator General in preference to the offer made by the plaintiff for Rs. 11,251. The Administrator General accordingly executed a conveyance in favour of the defendant Pratul Chandra Ghose (Exhibit P. X) who thereupon became the tenant of the premises. Having failed to obtain title to the premises from the Administrator General of Bengal the plaintiff approached the landlords and on 22nd September, 1937, obtained a Mokarari Mourashi Patta in respect of the disputed land on payment of a Selami of Rs. 3,205 and at an annual rent of Rs. 78 only. The defendant Pratul Chandra Ghose filed rent suits against the plaintiff in respect of the underlease held by the latter under the Administrator General of Bengal and obtained rent decrees. The plaintiff, however, on the strength of his new title derived from the superior landlords under the Mourashi Patta served 937 notice on the defendant Pratul Chandra Ghose on the 7th October, 1937, requiring him to vacate the premises on the last day of the month of Chaitra 1944 B. section The defendant Pratul Chandra Ghose, not having vacated the premises, the plaintiff filed the suit out of which the present appeal has arisen. Shri N. C. Chatterjee contends that in view of the decision in the suit of 1859 it was not open to the defendant Pratul Chandra Ghose to contend that his tenancy was a heritable permanent tenancy. This point was neither pleaded nor raised in the trial Court but was put forward for the first time before the High Court. The pleadings of the 1859 suit are not on the record but the substance of ' the written statement appears from the judgment Exhibit 24 passed in that case. The issues framed in that case have already been set out. There was no issue regarding the character of the tenancy, namely, whether it was permanent and heritable or otherwise. The only question there was whether rent could be assessed tinder the Regulation. There is nothing in that Regulation suggesting that rent could be assessed only if the tenancy was a ticca tenancy or that rent could not be assessed if the tenancy was a permanent one. The question of permanency of the tenancy was not, therefore, directly or substantially in issue. We find ourselves in agreement with the High Court that the permanency of tenure does not necessarily imply both fixity of rent and fixity of occupation. The fact of enhancement of rent in 1859 may be a circumstance to be taken into consideration but it does not necessarily militate against the tenancy being a permanent one, as held by the Privy Council in the case of an agricultural tenancy in Shankarrao vs Sambhu Wallad(l). The principle of that decision was applied also to non agricultural tenancies in Jogendra Krishna Banerji vs Sm. Subashini Dassi(2). In Probhas Chandra Mallik vs Debendra Nath Das(3) also the same view was taken. We, therefore, hold that the plea of res judicata cannot be sustained. (1) (2) (3) , 121 938 Shri N. C. Chatterjee then contends, relying on the decisions in Rasmoy Purkatt vs Srinath Moyra (1), Digbijoy Roy vs Shaikh Aya Rahman (2), Satyendra Nath vs Charu Sankar (3 ) and Kamal Kumar Datta vs Nanda Lal Dule ( 4 ) that the tenancy in this case cannot be regarded as a permanent one. The decisions in those cases have to be read in the light of the facts of those particular cases. The mere fact of rent having been received from a certain person may not, as held in Rasamoy Purkatt vs Srinath Moyra (supra) and Digbijoy Roy vs Shaikh Aya Rahman (supra), amount to a recognition of that person as a tenant. Mere possession for generations at a uniform rent or construction of permanent structure by itself may not be conclusive proof of a permanent right as held in Kamal Kumar Dutt vs Nanda Lal Dule (supra) but the cumulative effect of such fact coupled with several other facts may lead to the inference of a permanent tenancy as indicated even in the case of Satyendra Nath vs Charu Sankar (supra) on which Shri N. C. Chatterjee relies. What, then, are the salient facts before us ? It is not known how the earliest known tenant Shaik Manik acquired the tenancy or what the nature of that tenancy was. The tenancy has passed from one person to another by inheritance or by will or by transfers inter vivos. In the deeds of transfer the transferee has been given the right to enjoy the property from generation to generation for ever. A tank has been excavated and a pucca ghat built on the land. Bricks have been manufactured with the earth taken from the land and the premises have been enclosed within pucca walls. Pucca buildings have been erected and mortgages have been executed for substantial amounts. Although there was an enhancement of rent in 1860 that rent has continued to be paid ever since then. Portion of the premises, namely, No. 2, Watkin 's Lane, has been used as a factory by the plaintiffs and on the other portion, namely, No. 3, Watkin 's Lane, residential buildings were erected which indicate that the lease was for residential purposes. As already (1) (2) (3) (4) Cal. 939 indicated there have been many transfers and devolutions and the landlords have accepted rent ' from the transferees or the successors. The names of Mrs. Cynthia Mills and Dobson and, Jones were mutated in the Zamindar 's Sherista. Although in the rent receipts Dobson continued to be shown as the recorded tenant, eventually Jones 's name appears on the rent receipts as tenant. In spite of the increase in land value and the letting value the landlords through whom the plaintiff derives his title did not at any time make may attempt to eject the tenant or to get any further enhancement of rent since 1860. All these circumstances put together are explicable only on the hypothesis of permanency of the tenure and they irresistibly lead to the conclusion, as held by the lower Courts, that the tenancy in question was heritable and a permanent one. The decision of Mukherjea, J., in the case of Probhas Chandra Mallick vs Debendra Nath Das (supra) is definitely in point. In this view of the matter we hold that the Courts below were right in dismissing the plaintiff 's claim for ejectment. ' In the result this appeal must fail and we dismiss it with costs. Appeal dismissed.

Permanency of tenure does not necessarily imply both fixity of rent and fixity of occupation and the fact of enhancement of rent does not necessarily militate against the tenancy being a permanent one. When, therefore, in a previous suit the only question was whether the jama could be increased and the jama was increased: Held, that this decision did not operate as res judicata on the question of permanency of the tenure in a subsequent suit for ejectment. Shankar Rao vs Sambhu Wallad ; Jogendra Krishna Banerji vs Subashini Dassi , Probhas Chandra Mallick vs Debendra Nath Das (1939) 43 C.W.N.828, relied on. Mere possession for generations at a uniform rent, or construction of permanent structures by itself may not be conclusive proof of a permanent right but the cumulative affect of such facts coupled with other facts may lead to the inference of a permanent 931 tenancy Where it was not known how the earliest known tenant acquired the tenancy or what the nature of the tenancy was, the tenancy bad passed from one person to another by inheritance or by will or by transfer inter vivos, in the deeds of transfer the transferee was given the right to enjoy from generation to generation for ever, pucka structures and tanks had been constructed, and though there was an enhancement of rent in 1860, the rent bad not been increased since then: Held, that all these circumstances put together irresistibly led to the conclusion of a permanency of the tenure. Probhas Chandra Mallik vs Debendra Nath Das (1939) 43 O.W.N. 828 referred to.

ION: Criminal Appeal No. 194 of 1960. Appeal by special leave from the Judgment and Order dated January 20, 1960, of the Punjab High Court in Criminal Revision No. 1485 of 1959. Porus A. Mehta, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellants. H. R. Khanna and P. D. Menon, for the respondent. November 13. The Judgment of the Court was delivered by AYYANGAR, J. The three appellants were convicted by the First Class Magistrate of Jullundur of an offence under section 167 (81) of the for "having acquired possession of smuggled gold and for carrying, keeping and concealing the said gold with intent to defraud the Government knowing that the gold had been smuggled into India from a foreign country and that no duty had been paid thereon," and were sentenced to terms of imprisonment. Appeals were filed by the accused to the Sessions Judge, Jullundur but the convictions were upheld though the sentence was reduced in the case of the third appellant. A revision petition preferred therefrom to the High Court of Punjab was dismissed and thereafter the appellants obtained leave from this Court under article 136 of the Constitution and filed the appeal which is now before us. A few facts are necessary to be stated to appreciate the point raised for decision. The City Inspector of Police, Jullundur is stated to have 366 received information that some smugglers were on the point of transporting gold from Amritsar into Jullundur and at about mid night on July 16, 1958, further information that some of these had actually come and were present in the house of Gian Chand the first appellant. A raid party was accordingly orgainsed and the house of the first appellant was cordoned and raided at about 3 A.M. on the early morning of July 17,1958. In the course of the search certain bars of gold were found on the person of some of the inmates of the house and in the house itself, as also a large amount of cash. Thereafter the first appellant, his wife the third appellant and her brother the second appellant were arrested, the gold found was seized and a complaint filed charging the three accused of offences under sections 411 and 414 of the Indian Penal Code. This charge of receiving stolen property preferred against the three appellants was, however, not proceeded with and the Police Inspector made a report to the Court on January 7, 1959, that no case had been made out against them, and the case was thereupon dropped. Meanwhile, the Assistant Collector of Customs contacted the City Police at Jullundur and made an application to the Court of the First Class Magistrate, Jullundur for the delivery of these gold bars to the Customs authorities obviously under section 180 of the to the terms of which we shall refer later, and they were delivered to the Customs authorities on January 7, 1959, this being the date on which the case against the appellants under sections 411 and 414 of the Indian Penal Code was dismissed. Very soon thereafter a notice was issued to the appellants to show cause why the gold in the possession of the Customs authorities should not confiscated under section 167 (8) of the , and after considering the explanations of the appellants the Collector passed an order directing the confiscation of the gold. That order has 367 become final and this appeal is not concerned with the correctness of the order of confiscation of the gold under section 167 (8). During the proceedings before the Customs authorities for confiscation, sanction was accorded to prosecute the appellants for an offence under section 167 (81) which runs in these terms: "167. The offences mentioned in the first column of the following schedule shall be punishable to the extent mentioned in the third column of the same with reference to such offences respectively: Section of this Act to Offences which off Penalties ence has reference. If any person General such person knowingly, and with shall on con intent to defraud the viction before Government of any duty a Magistrate payable thereon, or to be liable to evade any prohibition or imprisonment restriction for the time for any term being in force under or not exceeding by virtue of this Act with two years, or respect thereto acquires to fine, or to possession of, or is in both. any way concerned in carrying, removing, depo siting, harbouring, keep ing or concealing or in any manner dealing with any goods which have been unlawfully removed from a ware house or which are chargeable with a duty which has not been paid or with respect 368 to the importation or exportation of which any prohibition or restriction is for the time being in force as aforesaid; or If any person is in relation to any goods in any way knowingly con cerned in any fraudulent evasion or attempt at evasion of any duty chargeable thereon or of any such prohibition or restriction as aforesaid or of any provision of this Act applicable to those goods," and it is the correctness of the conviction in the prosecution that followed which is the subject matter of the appeal now before us. It will be seen from the terms of section 167 (81) that there are two distinct matters which have to be established before a person could be held guilty of the offence there set out: (1) that the goods in this case (gold) were smuggled, i.e., imported into the country either without payment of duty or in contravention of any restriction or prohibition imposed as regards the entry of those goods, and (2) that the accused knowing that the goods were of that character did the acts specified in the latter part of the provision. It is clear that in the absence of any valid statutory provision in that behalf the onus of establishing the two ingredients necessary to bring home the offence to an accused is on the prosecution. In regard to the first of the above matters the position stands thus: With a view to conserve the foreign exchange resources of this country, in line with provisions framed for a like object by 369 several other Governments, the Foreign Exchange Regulation Act, 1947, was enacted which came into force on March 25, 1947. Section 8(1) of the Act enacted: "8. (1) The Central Government may, by notification in the Official Gazette, order that, subject to such exemptions, if any, as may be contained in the notification, no person shall, except with the general or special permission of the Reserve Bank and on payment of the fee, if any, prescribed bring or send into India any gold or silver or any currency notes or bank notes or coin whether Indian or foreign. Explanation. The bringing or sending into any port or place in India of any such article as aforesaid intended to be taken out of India without being removed from the ship of conveyance in which it is being carried shall nonetheless be deemed to be a bringing, or as the case may be sending, into India of that article for the purposes of this section. " On the same day on which the Act came into force a notification was issued under this section reading: "(1) Restrictions on import of gold and silver. In exercise of the powers conferred by sub section 1 of section 8 of the Foreign Exchange Regulation Act, 1947 (Act 7 of 1947) and in supersession of the notification of the Government of India in the late Finance Department No. 12 (11) FI/47, dated the 25th March, 1947, the Central Government is pleased to direct that except with the general or special permission of the Reserve Bank no person shall bring or send into India from any place outside India (a) any gold coin, gold bullion, gold sheets or gold ingot whether refined or not; " 370 Virtually therefore a ban was imposed on the import of gold into the country. This prohibition naturally resulted in the rise of the internal price of gold compared to its external price, i.e., its price in the international markets and this gave a great incentive to smuggling in the commodity. As a result Parliament enacted a provision (section 178 A of the ) reading: "178 A. (1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be on the person from whose possession the goods were seized. shifting the onus of proof in respect of particular commodities seized under the Act in stated circumstances that the goods were not smuggled, on the person from whose possession they were taken. Sub section (2) set out the commodities to which the section applied and gold was specified as one such. The details of the circumstances in which this provision found its place in the statute book as well as its construction have been dealt with in Collector of Customs, Madras vs Nathella Sampathu Chetty and need not here be repeated. Suffice it to say that if the terms of the section were satisfied the gold seized in the present case would be presumed to be smuggled and the burden of proving that they are not, would be on the person from whom they were seized. Without much of a discussion or a consideration of the several provisions the learned First Class Magistrate held that section 178 A of the was applicable to the case and that accordingly the onus was properly on the accused. Before considering his reasoning it is necessary to refer to a few other provisions of the 371 which have a bearing on the point now under discussion. Section 178 of the Act which empowers Customs Officers to effect a seizure of goods suspected by them to be smuggled, enacts: "178. Any thing liable to confiscation under this Act may be seized in any place in India either upon land or water, or within the Indian customs waters by any officer of Customs or other person duly employed for the prevention of smuggling. " Section 180 under the provisions of which the gold seized by the police as a result of their search on July 17, 1958, came into the possession of the Customs authorities, runs in these terms: "180. When any things liable to confiscation under this Act are seized by any Police officer on suspicion that they have been stolen, he may carry them to any police station or Court at which a complaint connected with the stealing or receiving of such things has been made, or an enquiry connected with such stealing or receiving is in progress, and there detain such things until the dismissal of such complaint or the conclusion of such enquiry or of any trial thence resulting. In every such case the Police officer seizing the things shall send written notice of their seizure and detention to the nearest custom house; and immediately after the dismissal of the complaint or the conclusion of the enquiry or trial, he shall cause such things to be conveyed to, and deposited at, the nearest custom house, to be there proceeded against according to law. " The question that now arises is whether the possession obtained by the Customs department by goods being "conveyed to and deposited at the nearest Custom house" within the last words of the second 372 paragraph of section 180 are goods which have been seized under the Act within the opening words of section 178A. In the first place, it would be seen that these three sections which have to be read together draw a distinction between seizure under the Act and a seizure under provisions of other laws. A seizure under the Act is one for which the authority to seize is conferred by the Act and in the context it could be referred to as a seizure under section 178. The seizure from the owner of the property under section 180 is not a seizure under the Act but by a police officer effecting the seizure under other provisions of the law, for instance the Criminal Procedure Code. And that is made clear by appropriate language in the first paragraph of section 180. Learned Counsel for the respondent State has urged that "the conveyance and deposit" in the office of the Customs authority under the second paragraph of section 180 also involves a seizure under the Act and for this purpose relied on the meaning of the word 'seize ' given in Ballantyne 's Law Dictionary where it is equated to "taking a thing into possession". This however might be the meaning in particular contexts when used in the sense of the cognate Latin expression "Seized" while in the context in which it is used in the Act in section 178A it means 'take possession of contrary to the wishes of the owner of the property '. No doubt, in cases where a delivery is effected by an owner of the goods in pursuance of a demand under legal right, whether oral or backed by a warrant, it would certainly be a case of seizure but the idea that it is the unilateral act of the person seizing is the very essence of the concept. There is another matter to which reference should be made which, in our opinion, conclusively establishes that the delivery of the goods to the Customs authorities under the latter part of section 180 is not seizure under the Act within the meaning of section 178A. The last part of sub section (1) of section 178A lays 373 the burden of proving that the goods are not smuggled on "the person from whose possession the goods are taken". Assuredly when the goods are delivered to the Customs authorities by the Magistrate they are not taken from the possession of the persons accused in criminal case so as to throw the burden of proof on them and it would lead to an absurdity to hold that the section contemplated "proof to the contrary" by the Magistrate under whose orders the delivery was effected. For the purpose of deciding the point arising in this case we do not think it necessary to enter into the philosophy or refinements of the law as to the nature of possession. When the goods were seized by the police they ceased to be in the possession of the accused and passed into the possession of the police and when they were with the Magistrate it is unnecessary to consider whether the Magistrate had possession or merely custody of the goods. The suggestion that the goods continued to be, at that stage, in the possession of the accused does not embody a correct appreciation of the law as regards possession. A 'seizure ' under the authority of law does not involve a deprivation of possession and not merely of custody and so when the police officer seized the goods, the accused lost possession which vested in the police. When that possession is transferred, by virtue of the provisions contained in section 180 to the Customs authorities, there is no fresh seizure under the . It would, therefore, follow that, having regard to the circumstances in which the gold came into the possession of the Customs authorities, the terms of section 178A which requires a seizure under the Act were not satisfied and consequently that provision cannot be availed of to throw the burden of proving that the gold was not smuggled, on the accused. Through the learned Magistrate held that section 178A applied to the case, he also entered into an elaborate discussion of the positive evidence in the case, so that it is not quite clear whether he would 374 have reached the same conclusion, viz., that the gold was smuggled, even without reference to the rule as to onus enacted by that section. When the matter was before the learned Sessions Judge he first held that section 178A of the Customs Act did apply to the case before him but proceeded also to deal with the case on an alternative footing that the provisions of section 178A were not applicable to the case and set out the circumstances which led him to that conclusion. The learned Single Judge who heard the revision in the High Court, however, dealt with the case solely on the footing that section 178A was applicable. The constitutional validity of that section was challenged before the High Court and figured prominently in the grounds of appeal to this Court but this point has been decided against the appellants by this Court and is therefore no longer a live issue. If, as we have pointed out earlier, the delivery to the Customs authorities under section 180 is not a seizure under the Act within section 178A it would follow that the judgment of the High Court cannot be upheld for it has proceeded on the sole basis of the provisions of that section being attracted. We have already pointed out that the learned Sessions Judge had upheld the conviction of the appellants by an independent finding that the prosecution had positively established that the goods were smuggled and that the accused had knowingly done the acts referred to in section 167(81) with which they were charged. This part of the case of the prosecution has not been considered by the learned Judge in the High Court and this would have to be done before the revision petition of the appellants could properly be disposed of. The appeal is accordingly allowed and the order of the High Court set aside. The case will be remitted to the High Court for the revision petition of the appellants being disposed of in the light of this judgment and in accordance with law.

On receipt of information that some smugglers were transporting gold from Amritsar into Jullundur, the police made a raid of the house of the first appellant in Jullundur and in the course of the search certain bars of gold were found on the person of some of the inmates of the house and in the house itself. The gold found was seized by the police and the appellants were prosecuted on a charge of receiving stolen property. The case however was not proceeded with and, in the meantime, the customs authorities contacted the police and on the order of the Magistrate on an application under section 180 of the , made by them the gold bars were delivered to them. Proceedings were taken by the Collector of Customs for confiscation of the gold under section 167 (8) of the Act, and the appellants were prosecuted for an offence under section 167 (81) of the Act on the ground that the gold was smuggled and that the appellants, did the acts specified in that section knowing that the gold was of that character. The Magistrate took the view that section 178A of the Act was applicable to the case so that the burden of proving that the gold was not smuggled could be laid on the appellants. The question was whether the possession obtained by the customs authorities under section 180 of the Act was such that the goods could be treated as that seized under the Act within the meaning of section 178A of the Act. ^ Held, that the taking possession of the goods by the customs authorities when they were delivered to them under section 180 of the , did not amount to a seizure under the Act within the meaning of section 178A of the Act. A seizure under the authority of law involved a deprivation of possession and when the police seized the goods the appellants lost possession which vested in the police so 365 that when the possession was transferred to the customs authorities by virtue of the provisions in section 180 there was no fresh seizure under the Act. Accordingly, section 178 was not applicable to the case. The term "seized" in section 178A means "taken possession of contrary to the wishes of the owner of property".

Civil Appeals Nos. 415 418 of 1960. Appeals from the judgments and orders dated September 23, 1958, of the Bombay High Court in Special Civil Applications Nos. 205 and 214 of 1958. 383 A. V. Viswanatha Sastri, section P. Verma, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellants (in C. A. No. 415 of 1960). A. section Bodde and Ganapat Rai, for the appellants (in C. A. No. 417 of 1960) and respondents (in C. A. No. 418/60). H. R. Khanna and R. H. Dhebar, for the appellants (in C. As. Nos. 416 and 418 of 1960) and respondent No. 1 (in C. As. Nos. 415 and 417 of 1960). A. G. Ratnaparkhi, for respondent No. 3 (in C. A. No. 415 of 1960). 1961 November 15. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. These four appeals consist of two sets of cross appeals each and they arise from two petitions filed in the High Court of Bombay at Nagpur challenging the validity of the notification dated June 11, 1958, issued by the State of Bombay, now represented by the State of Maharashtra, under section 5 of the , ( 11 of 1948) (hereafter called the Act.) The petitioners in Special Civil Application No. 205 of 1958 are the Bidi, Bidi Leaves and Tobacco Merchants ' Association, Gondia and two others, whereas the petitioners in Special Civil Application No. 214 of 1958 are Haji latif Ghani Kachhi and five others. The impugned notification consists of seven clauses. By the majority decision of the High Court cls. 1 to 5 and the first part of cl. 6 are held to be intra vires, whereas the latter part of cl. 6 and cl. 7 as well as the explanation added to it are held to be ultra vires. The first part of the finding is Challenged by the petitioners in the two writ petitions by their Civil Appeals Nos. 415 and 417 respectively, while the latter part of the finding is challenged by the State of Maharashtra in its Civil Appeals Nos. 416 and 418 respectively. Thus, Civil Appeals Nos. 415 and 416 are cross 384 appeals and Civil Appeals Nos. 417 and 418 are cross appeals. These appeals have been brought to this Court with a certificate granted by the High Court under article 132(1) of the Constitution. As will presently appear the only point which calls for our decision in these appeals is one relating to the validity of the impugned notification; and so the certificate might well have been given under article 133 (1)(c) and not under article 132 (1) because the case does not involve a substantial question of law as to the interpretation of the Constitution. For convenience we will refer to the petitioners in the writ petitions as petitioners and the State of Maharashtra as the respondent in these appeals. The petitioners are bidi manufacturers in different parts of the Vidarbha region and they employ a large number of persons for the purpose of making bidis for them. It appears that the Government of the State of Madhya Pradesh within whose jurisdiction Vidarbha was then situated had fixed the minimum rates of wages in respect of employment in tobacco (including bidi making) manufactories by issuing a notification on January 11, 1951. This notification had purported to fix the minimum rates of wages per 1000 bidis by reference to different localities in the State. The rates thus fixed were inclusive of dearness allowance or compensatory cost of living allowance and they varied from place to place as specified in columns 2 to 4 of the notification respectively. An Advisory Board was thereafter constituted by the said State in exercise of the powers conferred on it by section 7 of the Act. Subsequently, in 1956 the said minimum rates of wages were revised by a notification issued on February 23, 1956. As a result of the State Reorganisation Act, 1956 (37 of 1956) the Vidarbha region became part of the State of Bombay. After Vidarbha thus became a part of the State of Bombay the Government of Bombay notified that the Advisory Board appointed by the said Government 385 under section 7 shall be the Advisory Board for Vidarbha. This notification was issued on November 1, 1956. The Government of Bombay then issued a notification publishing the draft of the notification which was proposed to be issued under section 5, sub section (2) read with cl. (b) of sub section (1) of section 5, and notice was thereby given to all the bidi manufacturers that the said draft would be taken into consideration on or after March 1, 1957. Thereafter the procedure prescribed by section 5 was followed, an enquiry was held, a report of the Advisory Board was received and finally the impugned notification was issued on June 11, 1958. It is the validity of the several clauses contained in this notification that is challenged before us in the present appeals. In their petitions the petitioners alleged that cls. 3 to 7 of the notification were invalid and ultra vires the powers of the respondent under sections 3, 4 and 5 of the Act. According to them the respondent had no power to make provision for deciding as to the extent to which "chhat" will be permitted or directing the action to be taken by the employer and employee relating to bad bidis. Their contention was that the said clauses purported to make provisions for the settlement of disputes between the employer and the employee concerning an Industrial matter and were outside the purview of the respondent 's power under the relevant sections. They urged that the different provisions of the notification were so interrelated that it was difficult to dissociate one from the other and so it was necessary that the notification as a whole should be quashed. The respondent disputed the correctness of the contentions raised by the petitioners. It urged that there were constant disputes among bidi manufacturers and bidi workers regarding the minimum wages fixed in the Vidarbha region and so the respondent thought it necessary to institute 386 an enquiry into these complaints in order to decide whether it was necessary to revise the minimum wages prescribed by the earlier notification and the mode of determining those wages. It was only after a comprehensive enquiry was held at which all parties were heard that the respondent issued the notification in question. Its case was that the minimum rates of wages had been fixed on industry cum regionwise basis and that cls. 3 to 7 were intended to make the fixation of minimum rates of wages effective. According to the respondent, the absence of any rules regarding the exercise of the right of "chhat" by the employers tends to deprive the bidi workers of their right of getting minimum rates of wages, and so cls. 3 to 7 were deliberately introduced to make the material provisions of the Act effective in their implementation. These petitions were first heard by Mudholkar and Kotval, JJ. Mudholkar, J. held that all the clauses in the impugned notification were valid for, according to him, though the Act had not conferred express powers on the respondent to prescribe the impugned clauses of the notification yet the respondent could prescribe the said rules under the doctorine of implied powers. Kotval, J., agreed that cls. 1 and 2 were valid but he thought that even under the doctrine of implied powers the remaining cls. 3 to 7 could not be sustained. According to him the said clauses were, however, severable from cls. 1 and 2 and so they should be struck down leaving cls. 1 and 2 in tact. Since there was a difference of opinion between the two learned judges the matter was referred to Tambe, J. He held that cls. 1 to 5 and the first part of cl. 6 were intra vires where as the latter part of cl. 6 and cl. 7 as well as the explanation added to it were ultra vires. After Mr. Justice Tambe pronounced his judgment the matter was again referred to a Division Bench, and the Division Bench, in accordance with the majority opinion, has upheld the validity of cls. 1 to 5 and 387 the first part of cl. 6 and has struck down the latter part of cl. 6 as well as cl. 7 and its explanation. It is against this decision that the petitioners and the respondent have come to this Court with a certificate granted by the High Court in that behalf. Before dealing with the merits of the controversy between the parties it would be relevant to refer to the material provisions of the Act. The Act was passed in 1948 in order to provide for fixing minimum rates of wages in certain employments. Its provisions apply to the scheduled employment which expression under section 2 (g) means an employment specified in the schedule, or any process or branch of work forming part of such employment. It is common ground that employment in any tobacco (including bidi making) manufactory is a scheduled employment under the schedule of the Act. Section 2(h) defines wages and it prescribes inter alia, that wages means all, remuneration capable of being expressed in terms of money which would, if the terms of the contract of employment, express or implied, were fulfilled be payable to a person employed in respect of his employment or of work done in such employment, and includes house rent allowance, but does not include the items specified by cls.(i) to (v) of the said definition. Section 3 authorises the appropriate Government to prescribe different minimum rates of wages for different scheduled employments, different classes of work in the same scheduled employments, adults, adolescents, children and apprentices and different localities. Under section 4 are prescribed the components of the minimum rates of wages. Section 5 provides for the procedure for fixing and revising minimum wages. Section 7 provides, inter alia, that minimum wages payable under the Act shall be paid in cash. Under section 12 an obligation is imposed on the employer to pay every one of his employees engaged in the scheduled employment wages at a rate 388 not less than the minimum rate of wages fixed by the notification issued in that behalf. Section 12 (2) saves the application of the provisions of the payment of wages Act. Section 20 authorises the appropriate Government to appoint an authority to hear and decide for any specified area all claims arising out of the payment of less than the minimum rates of wages and other claims specified therein. The remaining sub sections of the said section prescribe the procedure for determining such claims. Under section 21 a single application can be made in respect of a number of employees who wish to prefer a claim for the decision of the authority under section 20. Section 22 prescribes penalties for the offences therein specified. Section 22A provides that if any employer contravenes any of the provisions of the Act or any rule or order made thereunder he shall, if no other penalty is provided for such contravention, be punishable with fine which may extend to five hundred rupees. Section 22B provides, inter alia the manner in which Courts may take cognizance of a complaint against any person for an offence committed under the Act. That in brief is the scheme of the material provisions of the Act. At this stage it would be necessary to read the several clauses of the impugned notification : "No. MWA. 1557 J. In exercise of the powers conferred by sub section (2) of section 5 read with clause (b) of sub section (1) of that section of the (XI of 1948) and after consulting the Advisory Board and in supersession of the former Government of Madhya Pradesh Labour Department Notification No. 564 451 XXIII, dated 23rd February, 1956, the Government of Bombay hereby revise the minimum rates of wages in respect of the employment in any tobacco (including bidi making) manufactory in the Vidarbha region of the State of Bombay 389 as mentioned in the Schedule hereto annexed and directs that this notification shall come into force with effect from 1st July, 1958. SCHEDULE Subject to the other provisions of this Schedule, the revised minimum rates of wages payable to employees per thousand bidis (when leaves are supplied by the employer) shall be as follows: Area Revised rates in Rs. (i) Nagpur District . 1.69 (ii) Bhandara District . 1.62 (iii) Chanda, Akola, Buldana, Yeotmal, Amravati and Wardha District . 1.56 2. For all bidis in which 7 chhataks or more of tobacco mixture is used and for those bidis which are known as "Hatnakun" bidis, there shall be an increase of 12 Naye Paise per 1000 bidis in the rates mentioned above in all the areas. It shall be within the discretion of the employer to decide which are "chhat" bidis or bad bidis, up to 5 per cent of the bidis prepared by the employee. If the employer decided that any bidis are "chhat" or bad, the "chhat" or bad bidis up to 5 per cent shall be destroyed forthwith by the employee and whatever tobacco is recovered from them shall be retained by the employer. If, however the employer wants to retain these "chhat" or bad bidis, he shall pay full wages for the same to the employee. If "chhat" or bad bidis are more than 5 per cent, but less than 10 per cent, and if there is any dispute between the employer 390 and the employee as to whether the '"chhat" or bad bidis is done properly or not, equal number of representatives of the employer and the employees shall inspect the "chhat" is done properly or not. If there is any difference of opinion among the representatives of the two sides, the majority opinion shall prevail. If the opinion is equally divided and the employer wants to retain the "chhat" bidis, he shall pay wages for "chhat" bidis between 5 per cent to 10 per cent at half the rates fixed above. If the employee does not want to retain these bidis the employee shall destroy them forthwith. The employer shall nominate his representatives and the employees shall elect their representatives. In the case of "chhat" above 10 per cent., the employee shall be entitled to full wages. It shall, however, be open to the employer to take suitable action against the employee if the "chhat" is more than 10 per cent for 6 continuous working days in a calendar month. The "chhat" shall be made once in a day only, at any premises within a distance of not more than 2 miles from the premises where bidis are manufactured. Explanation: For the purpose of this Schedule the expression "employer" includes his thekedar, contractor or agent as the case may be. ' The validity of cls. 1 and 2 is not in dispute. The petitioners, however, contend that cls. 3 to 7 are outside the powers conferred on the respondent by the relevant provisions of the Act and as such are invalid. It is common ground that even if the impugned clauses are held to be ultra vires they are 391 severable from cls. 1 and 2 so that the invalidity of the impugned clauses will not affect the validity of the said two clauses and they will stand even if the other clauses are struck down. In determining the question about the validity of the impugned clauses it is necessary to refer to two material facts. The nature and scope of the terms of contract between the petitioners and their employees are really not in dispute. It is alleged by the petitioners that they employ a large number of persons for the purpose of making bidis for them, that these persons are supplied with tendu leaves, tobacco and other necessary materials, they take the said articles to their respective places where they work and brings back the bidis prepared by them to the employer. The employer then examines the bidis ' accepts such of them as are found to have been prepared according to the terms of the contract rejects such of them as are found to be of poor quality and not prepared according to the terms of the contract and pays for the bidis actually accepted. The respondent has not traversed these allegations made by the petitioners. It admitted that the workers are paid on piece rate basis and the payment is made "on the basis of bidis selected and accepted by the employer after rejecting certain portions of bidis prepared by the workers". In fact the respondent has expressly stated that "there is a recognised practice of making payment on the basis of bidis accepted by employers as coming up to a certain standard of skill". It is further admitted that the employers have insisted on their right in principle of rejecting the sub normal or sub standard bidis prepared by the employees. Thus, there is no doubt that under the terms of the contract the workers are entitled to receive payment only for the bidis accepted by the employers, and not for those 392 which are rejected. It is also not disputed that the bidis which are rejected by the employers otherwise known as "chhats" are retained by the employer though he refuses to take them into account in the matter of payment to the workers on the ground that they do not come up to the standard of skill or quality prescribed by the contract. It also appears to be true that the employees in this region have been protesting against improper rejection of the bidis by the employers. They have contended that the employers reject an unreasonably high proportion of bidis falsely dubbing them as of sub normal quality without paying anything to the workers for their labour spent in rolling such rejected bidis. In its affidavit the respondent has emphasised that as a result of to is method of discarding bidis on the ground that they are of sub standard quality bidis workers were deprived of the labour charges for bidis which are rejected by their employers; and so it was urged that the question of fixing maximum rates of wages for bidi workers necessarily involved the question as to the quantum or percentage of such rejection which should be permissible to the employer. According to the respondent the impugned notification has purported to fix the minimum rates of wages after taking into consideration the problem presented by the practice of discarding bidis and paying wages to the workers only for such bidis as are accepted. In support of the validity of the notification the respondent also relied on the fact that the formula prescribed by the notification had been evolved after taking into account the representations made both by the employers and the employees. In fact, according to the respondent, this said formula represented a substantial degree of agreement between the parties on this point. It would thus be seen that on the two material facts there is really no serious dispute between the 393 parties. The respondent agrees that under the practice which must be taken to be consistent with the implied terms of contract between the bidi manufacturer and his employee, after the bidis are prepared by the employees and brought back to the employer the employer has a right to examine the quality of the bidis, accept only such as have come up to the standard prescribed by the contract and reject the rest. The practice further justifies the payment of wages to the employees only for the bidis actually accepted and not for those which are rejected though the rejected bidis may be retained by the employer. On the other hand, it is not, and cannot be seriously disputed by the petitioners that in some cases this practice may work great hardship on the workers, and in every case the workers do not get wages for the labour put by them in rolling the rejected bidis. The main question which arises for our decision in the present appeals is whether the injustice resulting from the practice of discarding bidis and not making any payment for them to the workers can be checked, controlled and regulated by the respondent by issuing a notification under the powers conferred on it by section 5 of the Act. If the relevant provisions of the Act confer upon the respondent the power to check the evil against which the workers complain then of course the validity of the impugned clauses would be beyond challenge. If, on the other hand, the power to prescribe or revise minimum rates of wages does not either expressly or by necessary implication include the power to provide for the machinery to check the evil in question, then the impugned clauses would be ultra vires however necessary it may be to check and control the said evil in question. In this connection let us broadly examine the scope and effect of the impugned clauses. Clauses 1 and 2 prescribe the revived minimum rates districtwise and provide for the payment of higher 394 Price for the bidis known as Hatnakhun bidis in all and the said districts. These two clauses are obviously valid and the petitioners have not disputed the conclusion of the High Court in that behalf. Clauses 3 to 6 deal with the problem of the that bidis or bidis which are rejected because they are bad. Clause 3 leaves it to the discretion of the employer to decide which are chhat bidis up to 5 percent of the bidis prepared by the employees. This clause provides that the bidis to rejected would be destroyed and tobacco recovered from them retained by the employer; and it adds that if the employer wants to retain the rejected bidis he shall pay full wages for the same to the employee. In other words this, clause means that the employer may discard bidis up to 5 percent but if he does not want to pay the workers for the said bidis he must destroy them. That would show that the discretion exercised by him is honest and fair. If, on the other hand, he wants to retain the said bidis that would mean that he thinks that the bidis would find a market and in that case he must pay for them on the basis that they are good bidis. On principle this provision may perhaps not be open to any serious criticism and it is not unlikely that if the notification had not made further detailed provisions by cls. 4 to 6 the present dispute would not have been brought before the High Court. The employers probably do not have a serious grievance against cl. 3 on the merits. Clause 4 deals with cases where the rejection may be more than 5 per cent but less than 10 per cent of total work produced by the worker. In regard to this class of cases cl. 4 provides for a machinery to deal with cases falling under it. Representatives of the employers and employees have to be appointed and they have to decide whether the work have been properly done or not. The decision would be according to the opinion of the majority. If the opinion is equally divided 395 and the employer wants to retain the chhat bidis, between 5 per cent to 10 per cent he shall pay at half the rates fixed in cl. 1. If the employer does not want to retain them the employees shall destroy them, The clause does not seem to provide for 3 7 case where the majority opinion may support the rejection between 5 per cent and 10 percent; that is a lacuna in the clause. The only comment which can be legitimately made against the clause on its merits is that the setting up of the machinery for a kind of adjudication of the dispute between the employer and the employee may, instead of solving the difficulties in actual working, add to them. That takes us to cl. 6. This clause has been very severely criticised by the petitioners. It provides that in case of chhat about 10 per cent the employees shall be entitled to full wages which means that even if chhat above 10 per cent is made reasonably and for a proper cause the employer has to pay for the discarded work as therein prescribed; the only right given to the employer in such a case is to take suitable action against the employee if the chhat is more than 10 per cent and that too for six continuous working days in a calendar month. Prima facie this clause appears to be unreasonable and unjust. The explanation to cl. 7 is also criticised by the petitioners because the thekedar, contractor or agent, who is appointed by the employer would, if the explanation is valid, be liable to perform all the obligations imposed on the employer by the relevant provisions of the Act such as sections 12 and 18. We have examined the broad features of the notification and indicated the comment made on it by the petitioners for the purpose of showing that on the merits some of the clauses do not appear to be fair and just, but that is not the ground on which their validity can be or has been challenged before us. The main argument in support of the challenge 396 rests on the assumption that cls. 3 to 7 are all beyond the powers conferred on the respondent by the relevant provisions of the Act; and it is this argument which needs to be examined. It is well settled that industrial adjudication under the provisions of the Industrial Disputes Act, 1947(14 of 1947) is given wide powers and jurisdiction to make appropriate awards in determining in industrial disputes brought before it. An award made in an industrial adjudication may impose new obligations on the employer in the interest of social justice and with a view to secure peace and harmony between the employer and his workmen and full co operation between them. Such an award may even alter the terms of employment if it is thought fit and necessary to do so. In deciding industrial disputes the jurisdiction of the tribunal is not confined to the administration of justice in accordance with the law of contract. Mukherjee, J., as he then was, has observed in The Bharat Bank Ltd., Delhi vs Employees of the Bharat Bank Ltd., Delhi the tribunal "can confer rights and privileges on either party which it considers reasonable and proper, though they may not be within the terms of any existing agreement. It has not merely to interpret or given effect to the contractual rights and obligations between them which it considers essential for keeping industrial peace." since the decision of the Federal Court in Western India Automobile Association vs Industrial Tribunal, Bombay, it has been repeatedly held that the jurisdiction of industrial tribunals if much wider and can be reasonably exercised in deciding industrial disputes with the object of keeping industrial peace and progress (Vide: Rohtas Industries, Ltd., vs Brijnandan Pandey; The Patna Electric Supply Co. Ltd., Patna vs The Patna Electric Supply Workers Union. Indeed, during the last ten years and more 397 industrial adjudication in this country has made so much progress in determining industrial disputes arising between industrial of different kind and their employee that the jurisdiction and authority of industrial tribunals to deal with such disputes with the object of ensuring social justice is no longer seriously disputed. But, it is necessary to remember that no claim can be made for such broad jurisdictional power by the respondent when it purports to issue a notification under the provisions of the Act. These powers and authority would necessarily be conditioned by the relevant provisions under which it purports to act, and the validity of the impugned notification must therefore be judged not by general considerations of social justice or even considerations for introducing industrial peace; they must be judged solely and exclusively by the test prescribed by the provisions of the statute itself. It appears that in 1956 before Vidarbha became a part of the state of Bombay the State Government of Madhdya Pradesh had made a comprehensive reference for the arbitration by the State Industrial Court between the bidi manufacturers of Bhandara District and their employee. In this dispute all the material issues arising from the prevailing practice which authorised employers to reject chhat bidis had been expressly referred for adjudication. Subsequently, when the impugned notification was issued the respondent apparently took the view that what could have been achieved by reference to the arbitration of state Industrial Court may well be accomplished by issuing a notification under section 5 of the Act. It may be that there is substance in the grievance made by the employees that the practice of rejecting chhat bidis often leads to the injustice and deprives them of the wages legitimately earned by them by rolling the said bidis and there can be no doubt that if a comprehensive reference is made for the decision of 398 this industrial dispute between the bidi manufacturers and their employees an award may well be passed which will resolve this dispute; but the question which falls for our decision is whether the relevant provisions of the Act authorised the State Government to make rules for the decision of the dispute in that behalf and for the payment of minimum rate of wages on the basis of such decision? In our opinion, the answer to this question has to be in the negative. What is the extent of the authority conferred on the respondent in fixing or revising minimum rates of the wages under the relevant provisions of the Acts In dealing with this question we must necessarily bear in mind the definition of the term "wages" prescribed by section 2(h). As we have already been the term "wages" includes remuneration which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment. In other words, the terms "wages" refers to remuneration payable to the employee as a result of the terms of employment. What would be the amount to which the employee is entitled if the other terms of the contract are preferred ? That the question which has to be asked in determining what the term "wages" means under (h). No doubt sections 3, 4 and 5 authorised the appropriate Government to fix the minimum rates of wages. In other words, if the wages fixed by a contract which is either express or implied are found to be low authority is conferred on the appropriate Government to increase them so as to bring them to the level of what the said Government regards as the minimum wages in the particular scheduled employment in the particular area concerned. This means that power is conferred on the appropriate Government to modify one term of the contract express or implied between the employer and the 399 employee and that is a term which has reference to the payment of wages. If for a certain piece of work done by the employee the employer has agreed to pay him either expressly or by implication a certain amount of wages the appropriate Government can issue a notification and prescribe that for the said work done under the contract the employer must pay his employee a much higher rate of wages and the higher rate of wages thus prescribed would be deemed to be the minimum rate of wages between the parties. It would, however, be noticed that in defining "wages" cl. 2(h) postulates that they would be payable if the other terms of the contract of employment are fulfilled. That is to say, authorising the fixation of minimum rates of wages the other terms of the contract of employment have always to be fulfilled. The fulfillment of the other terms of the contract is a condition precedent for the payment of wages as defined under section 2 (h) and it continues to be such a condition precedent even for the payment of the minimum rates of wages fixed and prescribed by the appropriate Government. The significance of the definition contained in section 2(h) lies in the fact that the, rate of wage may be increased but no change can be made in the other terms of the contract. In other words, the Act operated on the other terms of the Contract on the other terms of the contract between the employer and the employee. That is the basic approach which must be adopted in determining the scope and effect of the powers conferred on the appropriate Government by the relevant provisions of the statute authorising it to prescribe fix or minimum rates of wages or to revise them. What the appropriate Government is authorised to do is to proscribe, fix or revise wages and wages are defined to be remuneration payable to the employees if the terms of the contract of employment, express or implied, were fulfilled. 400 This definition runs, as it inevitably must, through the and the material provisions of the Act and its importance cannot therefore be ignored. Bearing this fact in mind let us examine the impugned clauses of the notification. Clauses 1 and 2 clearly fall within the purview of the power conferred on the respondent because they do no more than prescribe the minimum rates of rates as therein specified; out cls. 3 to 7 clearly and unambiguously purport to deal with the terms of the contract between the parties other than that relating to the remuneration. These clause are obviously intended to deal with the dispute between the employers and their employees as to how bidis should be discarded and in that proportion and what should be the procedure to be followed in regard to the? payment for such discarded bidis. In appreciating the true effect of these clauses it is necessary to recall that the parties are agreed about the practice at present prevailing which must be taken to represent the terms of the contract either express or implied. According to the said practice the employer decides which bidis should he discarded, he retains the discarded bidis and pays only for such bidis as are accepted be him. It if plain that the impugned clauses of the notification purport to modify these terms in material particulars and that and be plainly outside the jurisdiction of the authority of the respondent. It may well form the subject matter of reference for industrial adjudication but it cannot form the subject matter of a notification prescribing minimum rates of wages under sections 3, 4 or 5. It is conceded by the respondent that there is no express provision in the act, which authorised the setting up of the machinery as prescribed by cls. 3 and 4 or for laying down the manner in which the employer should make payment for the discarded bidis. It is, however, strenuously urged that the validity of these clauses should be upheld on the ground of the 401 implied power of the respondent; and that takes us to the question as to the true scope and effect of the doctrine of implied power. "One of the first principles of law with regal to the effect of an enabling act", observes Craies, "is that if a Legislature enables something to be done, it gives power at the same time by necessary implication to do everything which is indispensable for the purpose of carrying out the purposes in view(1)". The principle on which the doctrine is based is contained in the legal maxim 'Quando lex aliquid concedit concedere videtur et illud sine quo res ibsa ease non potest '. This maxim has been thus translated by Broom thus: "whoever grants a thing is deemed also to grant that without which the grant itself would be of no effect". Dealing with this doctrine Pollock, C.B., observed in Michaely Fenton and James Fraser vs John Stephen, Hempton "It becomes therefore all important to consider the true import of this maxim, and the extent to which it has been applied. After the fullest research which I have been able to bastow, I take the matter to stand thus : Whenever anything is authorised, and especially if, as matter of duty, required to be done by law, and it is found impossible to do that thing unless something else not authorised in express terms be else done, then that something will be supplied by necessary intendment." This doctrine can be invoked in cases "where an Act confers a jurisdiction it also confers by implication the power of doing all such acts, or employing such means as are essentially necessary to its execution (3). " In other words, the doctrine of implied powers can be legitimately invoked when it is found that a duty has been imposed or a power conferred on an authority by a statute and it is further found that the duty cannot be discharged or the power cannot be exercised at all unless some 402 auxiliary or incidental power is assumed to exist. In such a case, in the absence of an implied power the statute itself would become impossible of compliance. The impossibility in question must be of a general nature as that the performance of duty or the exercise of power is rendered impossible in all cases. It really means that the statutory provision would become a dead letter and cannot be enforced unless a subsidiary power is implied. This position in regard to the scope and effect of doctrine of implied powers is not seriously in dispute before us. The parties are at issue, however, on the question as to whether the doctrine of implied powers can help to validate the impugned clauses in the notification. The respondent strenuously contends that cls. 1 and 2 of the notification which have prescribed the minimum rates of wages per 1000 bidis would become ineffective unless cls. 3 to 7 supplement them. The argument is that by improper or dishonest exercise of the power conferred on the employer by the contract of employment to discard chhat bidis the employees would be cheated of their legitimate due wages under cls. 1 and 2 and so, in order to make the provisions of cls. 1 and 2 effective some subsidiary provisions had to be made for settling the dispute between the employer and his workmen in regard to chhat bidis. As we have already observed, the grievance made by the employees on the score of improper rejection of bidis may in many cases be well founded; but the seriousness of the said grievance and the urgent necessity to meet it would hardly be a proper basis for invoking the doctrine of implied power where the provisions of the statute are quite clearly against the assumption of such implied power. The definition of the term "wheres" postulates the binding character of the other terms of the contract and brings within the purview of the Act only one 403 term and that relates to wages and no other. That being so, it is difficult to hold that by implication the very basic concept of the term "wages" can be ignored and the other terms of the contract can be dealt with by the notification issued under the relevant provisions of the Act. When the said other terms of the contract are outside the scope of the Act altogether how could they be affected by the notification under the Act under the doctrine of implied powers Besides, in this connection it is also necessary to bear in mind the provisions of sections 20 and 21 of the Act. These two sections provide for the settlement of claims made by employees in regard to the payment of minimum rates of wages. If for instance, good bidis are rejected by the employer as chhat bidis improperly and without justification the employees can make a claim in that behalf and the same would be tried under sections 20 and 21. Therefore the Act has made a specific provision for the enforcement and implementation of the minimum rates of wages prescribed by notifications. The present notification purports to ignore the said provisions and sets up a machinery to settle the said disputes. Clauses 1 and 2 of the notification have prescribed the revised minimum rates of wages. If, in the matter of payment of the said wages, any disputes arise they must be left for adjudication by the authority prescribed by section 20. That is another reason why the doctrine of implied powers cannot be invoked in support of the validity of the impugned clauses in the notification. There is yet another consideration which is relevant in dealing with the question about the implied powers. The doctrine of implied power can be invoked where without the said power the material provision of the Act would become impossible of enforcement. In the present 404 case all that section 5 requires is the fixation of minimum rates of wages, and that has been done by the notification by cls. 1 and 2. What the subsidiary clauses purport to do is to make the enforcement of the fixed rate effective by providing for a machinery to deal with the possible disputes arising between the parties as a result of the practice of discarding chhat bidis. In other words, cls. 1 and 2 fix the minimum rates of wages and thus section 5 has been complied with and enforced. The remaining clauses purport to make the implementation of the provisions of cls. 1 and 2 effective. That is very different from giving effect to section 5 itself. The enforcement of the notification is clearly not the same thing as exercising the power of fixing or revising the minimum rates of wages under section 5. A Power may be implied, if necessary, in discharging the duty imposed upon the appropriate Government or in exercising the power conferred on the State Government in the matter of fixing or revising the minimum rates of wages; but surely no power can be implied for making effective the implementation of the notification issued under the said power or in the discharge of the said duty. The purpose of the Act cannot be said to have failed after the minimum rates of wages are prescribed and notified. What may turn out to be ineffective is the provision for payment of the said wages by reason of the rejection of good bidis; but that is a matter of an industrial dispute which has to be adjudicated upon under sections 20 and 21 or under other provisions of the law. It is true that a large section of the workers in the bidi trade is illiterate, uneducated and unorganised; and there can be no doubt that their grievance on the ground of improper rejection of the bidis deserves to be redressed, but, in our opinion, the procedure adopted by the respondent in redressing the said grievance is outside the scope of the Act, and therefore beyond the powers conferred on it by section 5. The proper remedy 405 in such a case may be to make a comprehensive reference of the dispute to the competent industrial tribunal and invite the tribunal to make a proper award in that behalf. We are, therefore, inclined to take the view that cls. 3 to 7 which form an integral scheme are outside the purview of the powers conferred on the respondent by section 5 of the Act and must therefore be declared to be ultra vires. It is common ground that these clauses are severable from cls. 1 and 2 and that their invalidity does not affect the validity of the said two clauses. In the result Civil Appeals Nos. 415 and 417 are allowed and Civil Appeals Nos. 416 and 418 are dismissed. Respondent to pay the costs of the petitioners in Civil Appeals Nos. 415 and 417. One set of hearing cost. C.A. Nos. 415, 417, allowed. C.A. Nos. 416, 418 dismissed.

By section 3 of the , the appropriate Government is authorised to fix minimum rates of wages for employees in the Scheduled employments and section 5 lays down the procedure for fixing and revising such minimum wages. The State Government published a notification dated June 11, 1958, fixing minimum rates of wages in respect of employments in bidi making in the Vidarbha region. Clauses 1 and 2 of the notification prescribed the minimum rates district wise and provided for higher rates for making bidis known as 'Hatnakhun ' in all the districts. Clauses 3 to 7 dealt with disputes between the employers and the employees as to how bad bidis were to be discarded and in what proportion and as to the payment for such discarded bidis. The appellant contended that cls. 3 to 7 of the notification were ultra vires: ^ Held, that cls. 3 to 7 of the Notification were outside the purview of the powers conferred upon the State Government 382 by section 5 of the Act and were ultra vires. The provisions of the Act empowered the Government only to fix minimum wages; they did not authorise it to make rules for resolving the disputes regarding the rejection of bad bidis and regarding the payments to be made for the rejected bidis. The Act empowered the Government to fix the remuneration payable to an employee if the other terms of the contract were observed; it did not authorise the Government to vary the other terms. Under the contract the employer was entitled to decide which bidis to discard, and to retain such bidis and to pay only for such bidis as were accepted by him. Clauses 3 to 7 of the notification purported to modify these terms in material particulars and this was not within the power conferred by the Act upon the Government. Nor could these clauses be justified on the basis of implied powers. The doctrine of implied powers could only be invoked when it was found that a duty was imposed or a power conferred on an authority buy a statute and it was further found that the duty could not be discharged or the powers could not be exercised at all unless some auxiliary or incidental power was assumed to exist. Even if cls. I and 2 would become ineffective without cls. 3 to 7 being there that would not be a proper basis for invoking the doctrine of implied powers. The definition of 'wages ' in section 2(h) of the Act postulated the binding character of the other terms of the contract and brought within the purview of the Act only the term relating to wages. By implication the very basic concept of wages could not be ignored. By sections 20 and 21 the Act makes specific provision for the settlement of claims in regard to payment of minimum wages and as such no powers could be implied in the Government to set up a separate machinery to settle such disputes. Further no power could be implied to make cls. 1 and 2 of the notification effective: such power could only be implied if it was necessary to make section 5 of the Act itself effective. Michael Fenton and James Fraser vs Jhon Stephen Hompton, (1957 59) 117 R. R. 21, referred to.

Civil Appeals Nos. 185 to 187 of 1961. Appeals by special leave from the judgment and order dated May 13, 1959, of the Patna High Court in Misc. Judicial Case No. 352 of 1957. WITH Petitions Nos. 163 to 165 of 1959. Petitions Under article 32 of the Constitution of India for the enforcement of Fundamental Rights. M. C. Setalvad, Attorney General of India, Veda Vyasa and Naunit Lal, for the appellants/petitioners. A. section R. Chari, D. P. Singh., M. K. Ramamurthi, R. K. Garg and section C. Agarwala, for the respondents. 500 1961. November 20. The Judgment of the Court was delivered by KAPUR, J. The principal question raised in these appeals and petitions under article 32 of the Constitution is whether sugar cane falls within the term "green vegetables" and is therefore exempt from sales tax under the exemption given by the notification dated August 28, 1947, issued under section 6 of the Bihar Sales Tax Act 1947, (Bihar 19 of 1947), hereinafter called the 'Act '. After hearing the arguments in these appeals and petitions we announced our decision dismissing them with costs and we now proceed to give our reasons for the same. The three appeals by special leave are brought by the assessee and relate to assessment of sales tax for three years, 1950 51, 1951 52 and 1952 53 for which the amount of sales tax levied was Rs. 28,866, Rs. 23,383 and Rs. 23,298 respectively. Besides the three appeals the assessee company has filed three petitions under article 32 challenging the constitutionality of the assessments. In this judgment the appellant and the petitioner is a private limited company and it will be termed "appellant" and the State of Bihar which is respondent will be termed the "respondent". The appellant took an objection to the assessment and filed appeals to the Deputy Commissioner of Commercial taxes and then a revision to the Board of Revenue and then at its instance the following question was referred by the Board of Revenue to the High Court for opinion: "Whether sugar cane is a green vegetable within the meaning of item 6 of notification No. 9884 FT dated 28 8 47 and as such exempt from taxation. " The High Court answered the question against the appellant and held that "sugar cane" was not 501 included in the term "green vegetables" and it is the correctness of that answer which has been canvassed before us. In the petitions under article 32 of the Constitution it was contended that the appellant being a producer of sugar cane was not a "dealer" within the meaning of the Act and therefore no tax was payable on sale of sugar cane by it. The exemption under the Act is provided under section 6 of the Act which, at the relevant time, was as follows: section 6 "No tax shall be payable under this Act on the sale of any goods or class of goods specified in this behalf by the (State) Government by notification in the Official Gazette, subject to such conditions as may be mentioned in the notification: Provided no notification shall be issued under this section without giving in the Official Gazette such previous notice as the State Government may consider reasonable, of its intention to issue such notification. " Under section 6 of the Act the notification relied upon was issued on August 28, 1947. This was notification No. 9884 FT which was in the following terms: "In exercise of the powers conferred by section 6 of the Bihar Sales Tax Act, 1947 (Bihar Act XIX of 1947), and in supersession of the previous notifications on the subject the Governor of Bihar is pleased to direct that no tax shall be payable under the said Act on the sale of goods specified in the second column of the schedule hereto annexed subject to the exceptions, if any, set out in the corresponding entry in the third column thereof. 502 THE SCHEDULE Serial Description Exception subject to which the No. of goods. exemption has been allowed. 1. . . . 2. . . . 3. . . . 4. . . . 5. . . . 6 Green vegetables Except when sold in sealed other than pota containers. . . . . . . . . . . ." The question raised is that sugar cane falls within the term "green vegetables" in entry 6 of the Schedule and is therefore exempt from assessment to Sales tax. In support of this contention counsel for the appellant relied upon a judgment of the for the appellant relied upon a judgment of the Bombay High Court, The State of Bombay vs R. section Phadtara (1) where it was held that sugar cane is "fresh vegetable" and is therefore exempt from sales tax under a similar notification issued under the Bombay Sales Tax Act. Changla C. J., there observed at page 496 as follows: "In its plain and natural meaning a "vegetable" clearly is wide enough to cover "sugar cane"; but what is urged by the Advocate General is that we must not give it that wide meaning but must give it the popular meaning as under stood by people who deal in vegetables or eat vegetables, and it is urged that from that narrow and restricted point of view sugar cane is not vegetable. This is a taxing statue and if in favour of that construction which gives relief to the subject. That was exactly the 503 approch of the Sales Tax Tribunal and in our opinion that approach was a very proper one." This observation is not in accord with the opinion given by this Court in Ramaytar Badhriprasad vs Assistant Sales tax Officer, Akola (1) in which under an almost identical entry it was held that "betel leaves" is not included in the term "vegetables". After quoting with approval a passage from the judgment of the Nagpur High Court, Madhya Pradesh pan Merchants Association vs State of Madhya Pradesh (2) this court said: "the word "vegetable" in taxing statutes is to be understood as in common parlance i.e. denoting class of vegetables which are grown in a kitchen garden or in a farm and are used for the table. " If that is the meaning of the word "vegetables" sugar cane cannot fail within entry 6 which relates to green vegetables. In Webster 's dictionary "sugar cane" has been defined as "a grass extensively grown in tropical and warm regions for its sugar" and in Oxford dictionary it is defined as "a tall peronnial grass cultivated in tropical and sub tropical countries and forming the chief source of unmanufactured sugar". Therefore it cannot be said that sugar cane falls within the definition of the words "green vegetables". The second question which was raised before us and which arises in the petitions under article 32 is that the appellant company is not a "dealer" within the meaning of the word as defined in section 2(c) of the Act which is as follows: " "dealer" means any person who sells or supplies any goods (including goods sold or supplied in the execution of a contract) 504 whether for commission, remuneration or otherwise and includes any family or a Hindu joint family, the Government and any society club or association which sells or supplies goods to its members". The words of this sub section are very wide and cover the case of the appellant and therefore this point is also without substance and must be rejected. But it was argued that the definition of the word "dealer" in the Act which was amended by Bihar Annual Finance Act 1950 is applicable only for the financial year beginning April 1, 1950, and not for subsequent years and for that aid was sought from the preamble to the Bihar Annual Finance Act 1950. That preamble is as follows: "whereas it is expedient to amend the Bihar Sales Tax Act, 1947, and the Bihar Agricultural Income Tax Act, 1948, to levy a tax on passengers and goods carried by public service vehicles and public carries and to lay down rates on Sales Tax payable under Bihar Sales Tax Act 1947 to fix limit of taxable agricultural income to lay down rates of agricultural Income Tax Act and Super Tax chargeable under Bihar Agricultural Income Tax Act, 1948 for the financial year beginning on the 1st day of April 1950 and to make further provisions in connection with the finance of this State of Bihar". The preamble cannot limit or change the meaning of the plain words of s.2(c) of the Act which apply to the case of the appellant and therefore the amended section is applicable to the present case. It is an erroneous approach to the question to say that because of the words "for the financial year beginning on the first of April 1950" in the particular context in the preamble, the definition of the word "dealer" was amended only for one year Nothing has been shown indicating that section 505 (2)(i) of Bihar Annual Finance Act intended to effect a temporary amendment in the previous definition of the word "dealer" in cl(c) of s.2 of the Act. The contention is therefore repelled. It was also submitted that the assent of the President was not given to the Bihar Annual Finance Act 1950. In our opinion that submission is equally without force because tax on sale of goods is a matter entirely within entry 54 of the State List and the amendment made in the definition of the word "dealer" in the Act did not require the assent of the President. In our opinion the appeals and the petitions under article 32 are without merit and are therefore dismissed with costs. One hearing fee. Appeals and writ petitions dismissed.

Under section 6 of the Bihar Sales Tax Act, 1947, the Government issued a notification exempting certain goods from the 499 payment of sales tax, including "green vegetables other than potatoes, except when sold in sealed containers". The appellant who was a producer of sugar can was assessed to sales tax. He contended that sugar cane was a green vegetables and was exempted from tax and that he was not a dealer as defined in section 2 (c) of the Act and could not be assessed to sales tax. ^ Held, that sugar cane was not a green vegetable and was not exempted under the notification. The word "vegetables" in taxing statutes was to be understood as in common parlance i.e. denoting class of vegetables which were grown in a kitchen garden or in a farm and were used for the table. The dictionaries defined sugar cane as a "grass." Ramavtar Budhaiprasad vs Assistant Sales Tax Officer, Akola, ; , followed. The State of Bombay vs R. section Phadtare, [1956] 7 section T. C. 495, disapproved. Held, further, that the appellant was a dealer within the definition in section 2(c). Section 2(c) was amended by the Bihar Annual Finance Act, 1950. The amended was not a temporary amendment for only one year; the amended section was applicable to the present case. The amending Act did not require the assent of the President as the matter fell entirely within entry 54 of the State List.

Civil Appeal No. 622 of 1960. Appeal from the judgment and order dated February 12, 1960, of the Allahabad High Court (Lucknow Bench) at Lucknow in Writ Petition No. 228 of 1959. 1. M. Lall, E. Udyarathnam and section section Shukla, for the appellant. C. B. Agrawalla and C. P. Lal, for the respondents. November 3. The Judgment of the Court was delivered by SHAH, J. In 1951 the appellant Devendra Pratap Narain Rai Sharma held the post of "Inspector Qanungo" in the Revenue Department of the State of Uttar Pradesh and was selected for the post of Tehsildar on probation. By order dated April 21, 1952, the Collector of Jhansi suspended the appellant and commenced an enquiry against him on certain charges of misdemeanour. In June, 1952, the Collector recommended to the Land Reforms Commission that the appellant be reverted to the post of "Naib Tehsildar", but the Commissioner recommended to the State Government that the applicant be dismissed from service. 317 The State Government accepted the recommendation of the Commissioner and dismissed the appellant from service, by order dated September 16, 1953. The appellant then commenced an action (Suit No. 163 of 1954) in the Court of the Civil Judge, Lucknow, challenging the legality of the order of dismissal principally on the ground that he was not afforded the opportunity of defending himself and of showing cause against the action proposed to be taken against him. The Civil Judge dismissed the suit but the decree of the Judge was reversed by the High Court of Civil Judicature at Allahabad. The High Court held that reasonable opportunity was not afforded to the appellant either before the recommendation was made for imposing penalty or before imposing punishment and therefore the appellant was deprived of the protection of article 311 of the Constitution. The High Court, accordingly, allowed the appeal, set aside the decree of the Civil Judge and granted a declaration that the order passed by the Government of Uttar Pradesh dated September 16, 1953, purporting to dismiss the appellant was void, inoperative and illegal and the appellant must be deemed to continue in service. The appellant was then by the Government of Uttar Pradesh Notification dated March 30, 1959, reinstated to his original post of Tehsildar. He was posted at Tehsil Puranpur in District Pilibhit and took charge of his office on April 28, 1959. The appellant then applied to the Accountant General of Uttar Pradesh for payment of arrears of salary and allowances due to him. The Accountant General, by letter dated May 18. 1959, informed the appellant that he was "entitled to draw pay and allowances with effect from April 28, 1959" and that as regards the arrears of pay and allowances for the period between April 21, 1952, and April 28, 1959, reference had been made to the State Government about the terms and 318 conditions of the appellant 's reinstatement and that action would be taken on receipt of instructions in that behalf. The appellant was again suspended by order dated July 11, 1959, issued by the Board of Revenue and was directed to hand over charge to the Naib Tehsildar of Tehsil Puranpur. On July 24, 1959, the Board of Revenue ordered that the salary of the appellant for the period between April 21, 1952, and the date of taking over charge of his duties as Tehsildar on reinstatement will be fixed as follows: (1) The pay from April 21, 1952 till the date of orders of his dismissal will be limited to the subsistence allowance of Rs. 76/11/ already drawn by him. (2) The pay for the period from the date following the date of the order of his dismissal till the date of his taking over charge of his duties as Tahsildar on reinstatement will be fixed at Rs. 1/ p.m. as token pay. The appellant was also informed that the period of his dismissal, i.e. April 21, 1952, to the date of his taking over charge of his office as Tehsildar on reinstatement will be treated as "on duty", and will count towards pension. The appellant applied on August 25, 1959, to the High Court at Allahabad by a petition under article 226 of the constitution praying for a writ quashing the order directing enquiry into the allegations regarding his work and conduct as Tehsildar at Garautha, District Jhansi and for a direction setting aside the order of suspension dated July 11, 1959, and for a direction permitting the appellant to draw his full salary and allowances with all increments amounting to Rs. 27,238/10/ and for an order to the Accountant General to issue pay slips at the rate of Rs. 325/ p.m. from the date 319 of taking over charge with dearness and house allowances with further increments, if any, falling due in the scale of Rs. 200 10 250 15 400, and for directions to the respondents to issue orders for confirmation of the appellant with effect from April 19, 1953. The appellant claimed that the Government of Uttar Pradesh had no power to reopen the enquiry concluded by the decision of the High Court of Allahabad and that the State was bound to pay him salary with increments and allowances for the period of suspension as if he was on duty during that period. He also claimed that he must be deemed to have been confirmed in the post of a Tehsildar and, therefore, entitled to salary in the grade of Tehsildar. The High Court held that the second enquiry against the appellant directed by the Board of Revenue was not barred by virtue of the previous decision and that the appellant could not be deemed to have been confirmed with effect from April, 1953. The High Court further held that because the appellant had not claimed the salary for the period April 21, 1959, to November 24, 1954, in the Civil Suit filed by him he should be deemed to have relinquished that part of his claim. Regarding the salary for the period November 24, 1954, to April 28, 1959, the High Court held that fixation of Rs. 1/ by the Board of Revenue as token salary of the appellant amounted to punishment which the Government could not impose without following the procedure laid down by article 311 of the Constitution. In the view of the High Court the appellant having been reinstated, there was no justification for not granting him full salary till July 14, 1959, the date till which he continued to function as Tehsildar after reinstatement. But the High Court observed, "A writ of mandamus can, however, only direct the opposite parties to proceed in accordance with law. We, therefore, direct that the order contained in annexure 11 be quashed and the State Government 320 directed to reconsider the matter in the light of the relevant rule after giving notice to and hearing the petitioner. " The High Court further held that the appellant was not entitled to any higher salary nor was there anything to show that he had earned any annual increment or had crossed the efficiency bar. Against the order passed by the High Court partially allowing the petition and directing the State Government to reconsider the matter regarding the pay and allowances due to the appellant for the period November 24, 1954, to April 28, 1959, this appeal has been preferred with certificate of fitness granted under Articles 132 (1) and 133 (1)(b) of the Constitution. In our view, the State Government was competent to direct a fresh enquiry against the appellant for dereliction of duty even if such dereliction was in the period relating to which proceedings were previously started and the appellant had been dismissed from service. The appellant was not in the earlier proceedings exonerated by the High Court in respect of the alleged misconduct charged against him, and, in any event, charge against him in the second enquiry was different from the charge in the first enquiry. The High Court had in the suit challenging the order passed in the first enquiry expressly observed that on the question as to misconduct and the punishment, no opinion was expressed. The suit filed by the appellant was decreed only on the ground that he had not been afforded a reasonable opportunity of showing cause against the charge against him and also the punishment decided to be imposed upon him. Authorities on which reliance was placed by counsel for the appellants, namely, Dwarkachand vs State of Rajasthan, Nanak Chandra Bairagi vs 321 Supdt. of police, Sibsagar and Mohan Singh Chaudhari vs Divisional Personal officer, Northern Railway, Ferozepore Cantt, do not support the plea that the second enquiry is, in the circumstances of the case, barred. An adjudication on the merits by a quasi Judicial body may or may not debar commencement of another enquiry in respect of the same subject matter. But in this case we are concerned with the scope of the High court order. The binding effect of a judgment depends not upon any technical consideration of form, but of substance. The High Court in the appeal filed by the appellant in suit No. 163 of 1954 did not exonerate the appellant from the charges. The High Court decreed the suit on the ground that the procedure for imposing the penalty was irregular, and such a decision cannot prevent the State from commencing another enquiry in respect of the same subject matter consistently with the provisions of articles 310 and 311. In Dwarkachand 's case, in a previous enquiry the public servant concerned had been exonerated; and in Mohan Singh Chaudhari 's case a decision by the, civil court declaring illegal an order dismissing a public servant by an officer not authorised in that behalf was held binding on all the parties in proceedings under Art 226 till such decision was set aside in accordance with law. In Kanak Chandra 's case it was held that an order in exercise of powers of revision by the Governor under the authority reserved to him setting aside on order of censure passed by a subordinate authority and dismissing the public servant concerned from service did not amount to a second departmental enquiry. These cases do not lend support to the proposition that after an order passed in a enquiry against a public servant imposing a penalty is quashed, by a civil court, no further proceeding can be commenced against him even if in the proceeding can be commenced against him even if in the proceeding in which the order quashing 322 the enquiry was passed, the merits of the charge against the public servant concerned were never investigated. If the State Government was competent to order a fresh enquiry, we see no reason why it would be incompetent to direct suspension of the appellant during the pendency of the enquiry. The High Court in dealing with the appellant 's claim to salary during the period of his suspension pending the earlier enquiry observed that there was no justification for "not granting the appellant his full pay" for the period after the date of the suit. But the counsel for the State of Uttar Pradesh asserted that it is open to the State, notwithstanding the direction, to award as remuneration to the appellant for the period for which he was under suspension any amount which on a reconsideration of the matter in the light of the relevant rules and after hearing the appellant the State Government considers just and proper. This power, counsel contends, arises by virtue of Rule 54 of the Fundamental Rules framed by the State of Uttar Pradesh under the authority conferred under article 309 of the Constitution. Counsel says that it was because of this rule that the High Court directed the State Government to reconsider the matter in the light of the relevant rules. In our view, this contention is wholly misconceived. Rule 54, as amended in 1953, stands as follows: "54. (1) When a Government servant who has been dismissed, removed or suspended is reinstated, the authority competent to order the reinstatement shall consider and make a specific order (a) regarding the pay and allowances to be paid to the Government servant for the period of his absence from duty and 323 (b) whether or not the said period shall be treated as a period spent on duty. (2) Where such competent authority holds that the Government servant has been fully exonerated or, in the case of suspension, that it was wholly unjustified, the Government servant shall be given the full pay to which he would have been entitled, had he not been dismissed, removed or suspended, as the case may be together with any allowances of which he was in receipt prior to his dismissal, removal or suspension. (3) In other cases, the Govt. servant shall be given such proportion of such pay and allowances as such competent authority may prescribe. Provided that the payment of allowances under clauses (2) and (3) shall be subject to all other conditions under which such allowances are admissible. (4) In a case falling under clauses(2) the period of absence from duty shall be treated as the period spent on duty for all purposes. (5) In a case falling under clause (3) the period of absence from duty shall not be treated as period spent on duty unless such competent authority specifically directs that it shall be so treated for any specified purposes. This rule has no application to cases like the present in which the dismissal of a public servant is declared invalid by a civil court and he is reinstated. This rule, undoubtedly enables the State Government to fix the pay of a public servant whose dismissal is set aside in a departmental appeal. But in this case the order of dismissal was declared invalid in a civil suit. The effect of the decree of the 324 civil suit was that the appellant was never to be deemed to have been lawfully dismissed from service and the order of reinstatement was superfluous. The effect of the adjudication of the civil court is to declare that the appellant had been wrongfully prevented from attending to his duties as a public servant. It would not in such a contingency be open to the authority to deprive the public servant of the remuneration which he would have earned had he been permitted to work. The High Court has disallowed to the appellant his salary prior to the date of the suit. The bar of O.2 r. 2 of the Civil Procedure Code on which the High Court apparently relied may not apply to a petition for a high prerogative writ under article 226 of the Constitution, but the High Court having disallowed the claim of the appellant for salary prior to the date of the suit, we do not think that we would be justified in interfering with the exercise of its discretion by the High Court. The order of the High Court therefore is confirmed. The State has made a wholly unjustifiable claim to fix the salary of a public servant wrongfully prevented from performing his duties, even after he is reinstated in consequence of a decision of the civil court declaring his dismissal as wrongful. As, however, the principal relief claimed by the appellant is not granted, we think that the proper order is that there will be no order as to costs throughout.

The order of dismissal against the appellant was set aside by the High Court, holding inter alia, that reasonable opportunity was set afforded to the appellant before imposing the penalty dismissed and the appellant must be deemed to continue in service. Thereafter the appellant was reinstated, but he was awarded salary at the rate of Rs. 76 11 0 till the order of dismissal, and at a token rate of Rs. 1/ for the period between the order of dismissal and reinstatement. The appellant was again suspended and enquiry was directed against him in respect of dereliction of duty for which he had already been once dismissed and re instated. The appellant moved the High Court for a writ to quash the order directing the said enquiry. He claimed that Government had no power to re open the enquiry concluded by the decision of the High Court and that the State was bound to pay him salary with increments for the period of suspension as if he was on duty during that period. The High Court, inter alia, held that the second enquiry against the appellant was not barred by virtue of the previous decision, but the fixation of token salary amounted to punishment which could not be imposed without following the procedure laid down in article 311 of the Constitution, and there was no justification for not granting him full salary. The appellant came up in appeal to the Supreme Court by certificate. ^ Held, that the State Government was competent in the circumstances, to direct a fresh enquiry against the public servant for dereliction of duty, and to suspend him. Where the order of dismissal of a public servant was declared invalid by the decree of a Civil Court the effect was that the public servant was never to be deemed to have been lawfully dismissed from service, and the order of reinstatement was superfluous. It was not open to the authority 316 to deprive the public servant of the remuneration which he would have earned has he been permitted to work. Held, further, that r. 54 of the Fundamental Rules of the Uttar Pradesh Government enables the State Government of fix the pay of a public servant, when dismissed is set aside in a departmental appeal, but that rule has no application to cases in which the dismissal of a public servant is declared invalid by the decree of a Civil Court and he is consequently re instated. Dwarkachand vs State of Rajasthan, I.L.R. , Nanak Chandra Bairagi vs Supdt. of Police, Sibsagar, I.L.R. and Mohan Singh Choudhri vs Divisional Personnel Officer, Northern Railway, Ferozepore Cantt. I.L.R. , not applicable.

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.

Civil Appeals Nos. 62 and 77 of 1959. Appeals from the judgment and decree dated March 25, 1953, of the Madras High Court in A. section Nos. 731 and 720 of 1950. M. C. Setalvad, Attorney general for India and M.S.K. Sastri for the appellants Nos. 2 to 8 and also for legal Representatives of appellant No. 1 in C. A. No. 62 of 1959. A. V. Viswanatha Sastri, M. K. Ramamurthi and section T. Venkataraman, for respondents Nos. 2 and 10 (in C. A. No. 62 of 69) and respondents Nos. 2 and 16 (In C. A. No. 77/59). 209 R. Ganapathy Iyer and G. Gopalakrishnan for appellant No. 2 and also for legal Representative of appellant No. 1 (in C. A. No. 77 of 1961) C. R. Pattabhi Raman and G. Gopalakrishnan, for appellant No. 3 in (C. A. No. 77/59). October 26. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. These two appeals have been brought to this Court by two sets of defendants with a certificate of the Madras High Court and they arise out of a suit instituted under o. 1, r. 8 on behalf of the general body of creditors for administration against the trustees and alienees of the properties which belonged to their debtors. Defendant 14 and his sons defendants 18 to 24 are the appellants in Civil Appeal No. 62 of 1959 while defendants 12, 13 and 16 are the appellants in Civil Appeal No. 77 of 1959. Defendants 1 to 6 are the debtors. They were members of an undivided Hindu family known as Kalakkad Pannayar family in Tirunelveli District. The family was doing Commission agency business in petrol, kerosene and crude oil. It had secured agency rights from the Burmah Shell Company. The members of the family became heavily indebted by about June, 1936, and as a result there was a pressure from their creditors. In order to meet the said pressure a deed of composition was executed (EX. B. 2) on July 8, 1936. As a result of this composition 56 out of the creditors of the family agreed to a scheme for settlement of their debts. Under this deed defendant 7 was constituted as a trustee and as such was empowered to take over the assets of the debtors, sell them to the best advantage and distribute the proceeds rateably amongst all credit. It appears that before the scheme under the competition could be successfully or effectively worked out one of the creditors, Ayyah Ayyar, filed an insolvency petition, No. 26 of 1936, in the Sub Court at Tirunelveli on July 30, 1936. By this 210 petition the creditor wanted defendants 1 to 6 to be r adjudged insolvent. During the pendency of these a proceedings, on August 26, 1936 defendants 1 to ff executed a deed of trust, (Ex.B.7); by this document they conveyed all their movable and immovable properties including (J the outstanding due to them to three trustees. These were defendant 7 Subbarayalu Reddiar, Veerabahu Pillai and Narayana Pillai. Tho trustees were authorised to dispose of the assets of (defendants 1 to 6 and distribute the proceeds rateably amongst the creditors. Narayana Pillai died in February, 1938. Veerabahu Pillai died some time before the present suit was instituted. Defendants 9 and 10 are the undivided sons of defendants 7, whereas defendant 11 is the widow and defendants 12 and 13 are the step brothers of Veerabahu Pillai. The trustees accerted the trust and entered upon their duties. They took possession of the immovable properties covered by the trust. They paid off the secured creditors, and in regard to unsecured creditors they arranged to pay 50% of their dues by selling the immovable properties either to the creditors themselves or to third parties directing them to discharge the secured debts, and the unsecured debts to the extent of 50% of their value. It is common ground that except their family house in which defendants 1 to 6 resided all other immovable properties belonging to them were conveyed under the trust deed. Defendant 14 was a secured creditor in whose favour a mortgage of the first schedule properties had been excelled for a sum of Rs. 30,000 on June 3, 1935 (exhibit B 95). This mortgage carried 10%, compound interest. It appears that he had also lent a sum of Rs. 3,000 on a promissory note on July 17, 1935 [exhibit B 95(a)]. This note carried interest at 12%. The promissory note was supported by the pledge of the mortgage deed. In order to pay off the debts thus due to defendant 14 the trustees conveyed to him schedule I mortgaged properties for Rs. 42,000 on May 22, 1937 (EX. B 94) 211 Out of the said consideration the amount due under the mortgage as well as the amount due under the promissory note were satisfied leaving a balance of Rs. 3,030 in the hands of the purchaser. He was directed to utilise this balance for repaying 50% of the dues of purchaser and 3 who have brought the present suit. The sale deed in favour of defendant 14 was executed by only two out of the three trustees,, defendant i and Veerabahu Pillai. Defendants 18 to 24 are the son of defendant 14. As we have already seen defendant 14 and his sons are the appellants in (Civil Appeal No. 62 of 1959. Defendant 7 who was one of the trustees, was a creditor of the trustees to the extent of Rs. 6,000. His daughter in law was a creditor to the extent of Rs. 2,000 . In satisfaction of 50% of the debt due to these two persons the trustees conveyed schedule III properties to defendants 8, 9 and 10 who are the undivided sons of defendant 7 (exhibit B. 8). This document executed on December 16, 1936, for Rs. 4,000. The purchasers in their turn sold the properties to defendant ]7 on May 30, 1947. Defendant 12 is the step brother of the trustee Veerabahu Pillai and he purchased schedule V properties on November 7, 1941, for Rs. 2,000 (exhibit B 90). Defendant 13 who is the brother of defendant 12 purchased schedule II properties for Rs. 15,000 on August 29, 1937, (exhibit B. 37). B. 37). This document was executed only by two out of the three trustees. Another sale deed was passed in favour of defendant 13 in respect of schedule properties (exhibit B. 79) on February , 1942, for Rs. 2,000. Defendant 16 who is the son in law of defendant 13 purchased two sets of properties schedule VII and schedule VII A on May 7, 1943, and June 4, 1943, (Exs. B 104 and B 105) for Rs. 8,000 and Rs. 600 respectively The properties thus conveyed to the respective purchasers were put into their possession. It is with the sale deeds executed in favour of defendant 14 and those executed in favour of 212 defendant 12, 13 and 16 that we are concerned in a the present appeals. Defendants 12, 13 and 16 are the appellants in Civil Appeal No. 77 of 1959. In 1943 defendants 1 to 6 brought a suit, o. section . No. 30 of 1943 in the Sub Court at Tirunelveli for the administration of the trust created by them, for account from the trustees and for recovery of the trust properties. To this suit they impleaded the surviving trustees and the alienees as defendants. In this suit a preliminary decree for account was passed by this Sub Court. Their claim, however, for the recovery of immovable properties was not Granted. This decree gave rise to three appeals before the Madras High court, one by defendants 1 to 6 and the others by the trustees and the alienees respectively. These appeals were appeals A. section No. 473, 510 and 544 of 1944. The three appeals were heard together and on December 20, 1944, a common judgment was delivered. The High Court confirmed the ending of the trial court that the trustee were liable to render account for the management of the trust, and it remanded the suit for a finding as to the market value of the lands covered by the respective sale deeds which had been challenged by defendants 1 to 6 The High Court thought that in determining the validity of the claim made by defendants 1 to 6 it was necessary to find out the proper value of the properties at the relevant time for that alone would enable the Court to decide whether the alienations had been effected by the trustees for grossly inadequate price as alleged by defendants 1 to 6. In the course of its judgment the High Court observed that it was not open to the authors of the trust to challenge the validity of the transaction which was permitted by them by the instrument of trust, for it was clear that under the said trust deed the trustee were empowered to convey properties to the creditors in the discharge of their duties. After remand the Subordinate Judge took 213 evidence, made his findings and submitted them to the High Court. It was at that stage that defendants 1 to 6 filed a petition for withdrawal of the litigation. This petition was allowed on December 12, 1947, with the result that the suit filed by defendants 1 to 6 O.S. No. 30 of 1943, was dismissed with costs throughout. Whilst the proceedings in the said three appeals were pending in the High Court and before defendants 1 to 6 were allowed to withdraw the litigation the present suit was filed on October 29, 1947, by the three plaintiff who are the creditors of defendants 1 to 6 and who purported to act on behalf of the general body of creditors. Leave was granted to the plaintiff under o. 1, r. 8 and the suit has, therefore, been conducted as a representative suit. In the suit the plaintiffs ask for an account from defendant 7 and defendants 11 to 13 who are the legal representatives of Veerabahu Pillai on the allegation that the trustee have been guilty of wilful default. They also claim a declaration that the properties described in schedules I to VII A and VIII are still impressed with the trust and they ask for an order for the administration of the trust by removing defendant 7 and appointing an administrator to realise the amount due from the trustees on such account and to recover possession of the properties mentioned in the said schedule, re call them and distribute the sale proceeds rateably amongst the unsecured creditors. Several defences were raised to this suit by the several defendants. It was denied that the trustees were negligent in the matter of collecting the outstandings and that the alienations effected by them were for inadequate considerations and otherwise improper and unjustified. It was urged that the present suit was barred by res judicata as a result of the withdrawal of 0. section No. 30 of 1943. It was further alleged that the suit was not maintainable, that it was bad for non joinder of 214 parties and was barred time. The respective by alienees pleaded that the transfers in their favour were valid and binding. Defendant 7 Defendant specifically urged that he was not guilty of any breach of trust; J and a plea was also raised that the creditors who . had filed the present suit had acquiesced in some of the dealings . Defendant 12 resisted the plaintiffs ' case that he had intermeddled in the management of the trust estate and was therefore liable as a trustee de son tort. An objection was raised about the proper valuation of the suit and it was urged that the proper court fee had not been paid. It was denied that sale deeds executed by only two out of the three trustees were invalid. On these pleadings twenty nine issues were framed by the learned trial judge. In substance the trial judge rejected the plaintiffs ' claim for account, but he passed a decree declaring that the properties described ill schedules I to III, V, VII, I to and VIII continued to be impressed with the trust imposed upon them by the trustees. The decree directed the removal of defendant 7 and the appointment of the advocates instead as administration. It further directed defendants is, 13,14, 16 and 17 to deliver possession of the properties in their respective possession and asked the administrators to re sell the said properties and distribute the proceeds amongst the creditors and to pay the surplus, if any, to defendants 1 to 6. Under the decree defendants 12, 13, 14 and 16 were held entitled to receive the respective consideration of the sales and mortgages together with interest and they were also liable to render account for profits of the properties in their possession. This decree gave rise to three appeals before the High Court. Appeal A. section No. 720 of 1949 was filed by defendant 14 and his sons defendants 18 to 24. Appeal A. No. 731 of 1949 was filed by defendants 12, 13 and 16; and Appeal A. section No. '21 215 of 1950 by defendants 8, 9, 10 and 17. Ill substance the High Court has confirmed the decree passed by the trial court and dismissed all the three appeals. The High Court has, however, modified the trial court`s decree in regard to the interest which the decree had ordered to be paid to the alienees. The High Court took the view that in adjusting equities between the alienees, the alienations in whose favour were found to be invalid, and the trust, the contract rate of interest need not be awarded. Subject to the modifications made in regard to the payment of interest the rest of the decree has been confirmed. Defendants X, 9 and 10 and the legal representative of defendant 17 who died pending the proceedings before the High Court have not challenged the decree passed by the High Court in their Appeal A. section No. 21 of 1950. Defendants 14 and 18 to 24 as well as defendants 12,13 and 16 have, however, challenged the decision of the High Court and have obtained a Certificate from the said High Court in that behalf It would thus be seen that in the two appeals before this Court we are concerned with six transactional. B 94 which is executed in favour of defendant which is executed in defendant 12, Exs. B. 37 and B. 79 which are executed in favour of defendant 13 and Exs. B 104 and R 105 which are executed in favour of defendant 16. Broadly stated both the Courts below have found that all these alienations were effected for inadequate consideration. It has also been found that Exs. B 94 and B 37 are invalid for the reason that they have bee executed by only two out of the three trustees, whereas the transfers under EXS. B 12, B 13 and be 16 held to be invalid as they are transfers in favour of the relations of one of the trustees Veerabahu. It has further been found that defendant 12 intermeddled with the estate of the trust and must therefore be regarded as trustee de son tort and therefore the transfer made to him is 216 invalid as a matter of law. Both the Courts have rejected the plea of res judicata and limitation raised by the defendants. There are some of the points of law which are common to both the appeals and it would be convenient to deal with them in a the order in which they have been raised before . The First point argued before US by the learned Attorney General on behalf of the appellants in Civil Appeal No. 62 of 1959 (defendants 14 and 18 to 24) is one of limitation. He contends that on a fair and reasonable construction the present suit attracts the application of article 120 and is therefore barred. On the other hand, Mr. viswanatha Sastri, for The plaintiffs, contends that the plaint clearly showed that the plaintiffs are not asking merely for a declaration but they are also claiming that a new administrator should be appointed and a direction should be issued that the property in question should be delivered to him. Such a claim, according to him, obviously attracts article 131. It is common ground that if article 120 applies the suit is beyond time, whereas if article 134 is applicable the suit is within time. The decision of this question would naturally depend upon the construction of the plaint. Is the claim made in the plaint one of declaration, or is it a claim for possession of immovable properties? The plaint sets out all the material facts which constitute the background to the present litigation, marks material allegations in respect of all the alienation impeached in the plaint, and by paragraph 35 it prays, inter aha, that schedules I to VII A and should be adjudged as still impressed as trust imposed on them by the deed of August 26, 1936, and direct their re sale. That is cl.(c) of paragraph 35. By cl.(d) it is prayed that the Court should order the administration of the trust by removing defendant 7 if need be and appointing an administrator or officer of court (1) to realise the 217 amounts mentioned in cl. (a), (b) to recover possession. and re sell the properties referred to in paragraph (c), (3) to distribute the proceeds rateably amongst the unsecured creditors and perform such other acts and functions as may be necessary to 6 effectuate the trust in question. The learned Attorney General contends that cl. (c) asks for adjudication or declaration that the properties in question are impressed with the trust and that is no mere than a declaration, and according to him cl.(d) prays for the appointment of an administrator to realise the amounts and to recover possession of the properties and re sell them. He suggests that on a fair construction of cl. (d) all that the plaintiff pray for is the removal of defendant 7 and the appointment of an administrator with power to realise the amounts specified and to recover possession of the properties indicated and to re sell them. This is not a claim that possession should be delivered to the administrator in the present suit. It may be conceded that if read by itself alone cl.(d) may be capable of the construction which the learned Attorney General seeks to put on it; but in construing the plaint we must have regard to all the relevant allegations made in the plaint and must look at the substance of the matter and not its form. It is significant that the plaintiffs have valued the suit for the purpose of court fee and jurisdiction at Rs. 23,745 and this valuation includes several items ill respect of different properties valued under s, 7(5) of the Court Fees Act. The valuation made in respect of the different items of properties under s.7(5) is obviously and clearly valuation made on the footing that a claim for possession is made. In fact the Plaint specifically avers that the plaintiff valued the suit for possession covered by covered and D 2 under . 7(5) as indicated in the plaint. Thus there can be no doubt that the plaint has been valued on the basic that a claim for possession of the properties covered by the schedules Is intended to be made. Besides, 218 it is also significant that in regard to the claim made be the plaintiff in respect of the transfer in favour of defendant 14 his sons defendant 18 to 24 have been joined specifically on the ground that since the plaintiffs claim possession of the said property the said defendants are necessary parties as it is found that they are in possession of the said properties. In other words, the joinder of defendants 18 to 24 to the present suit is based solely on the ground that a claim for possession is made in the plaint and defendants 18 to 24 being in possession are necessary parties to the suit. Therefore, in our opinion, reading the plaint as a whole it would be unreasonable to construe cl. (d) in paragraph 35 in the manner suggested by the learned Attorney General. The prayer which the clause really purports to make is that as administrator should be appointed and that an order should be passed against the respective defendants asking them to deliver possession of the properties to the said administrator. If that we so the plaint cannot be construed as one in which a mere claim for declaration is made. It is a plaint in which a declaration is no doubt claimed but based on the said declaration or adjudication a further claim for possession to the administrator is also made. The result, therefore, is that the argument that the prayer made in the plaint attracts article 120 must be rejected. The next continuation urged is that the plaintiffs cannot sue for possession but must Confine themselves only to a claim for declaration. It is not disputed by the learned Attorney General that in regard to public charitable trusts the beneficiaries are entitled to sue for setting aside alienations of the trust properties improperly effected by the trustees, and to ask for the restoration of possession of the said trust properties to the trustees newly appointed. Indeed, there is ample judicial 219 authority in support of this position. In A. Subramania Iyer vs P Nagarathna Naicker (1), it was held by the Madras High Court that in a suit by the worshippers of a temple to have the alienation of the trust property by some of the defendants, trustees. to the other defendants declared invalid and for possession to the trustees, the proper decree to be made if the Court be of the opinion that the alienation is invalid is to decree possession to those defendants who are trustee. It was further held that the trustees need not be referred to a separate suit for the purpose. In masjid Shahid Ganj vs Shiromani, gurdwara Parbandhak Committee, Amritsar (2) the Privy Council has recognised this right in these words: 'The right of a Muslim worshipper may be regarded as an individual right, but what is the nature of the right It is not a sort of easement in gross, but an element in the general right of a beneficiary to have the waqf property recovered by its proper custodians and applied to its proper purpose. Such an individual may, if he sues in time, procure the ejectment of a trespasser and have the property delivered into the possession of the Mutawali or of some other person for the purposes of the waqf ". The argument, however, is that in regard to private trustee which are governed by the Indian Trusts Act such a course is not open to the beneficiary because of the provisions of s.63 of the Trustee Act. Section 63 provides that where trust property comes into the hands of a third person inconsistently with the trust, the beneficiary may require him to admit formally, or may institute a suit for a declaration, that the property is comprised in the trust. The learned Attorney General contends that the only remedy available to a beneficiary under a private trust is that prescribed by 863 and no other. He can either require the alienee to admit that the property is comprised in the trust, or if the alienee refuses to make the admission the (1) (2) (1940) L. R. 671. A. 251, 267, 220 beneficiary may bring a suit for a declaration in that behalf In support of this contention strong reliance has been placed on the decision of the Privy Council in Rani (Chhatra Kumari Devi vs Prince Mohan Bikram Shah (1). In that case the respondent had claimed title to the properties as owner in various ways and had sued as the proprietor of the properties covered by the action. All these grounds were rejected and it was held that the respondent could claim no title as a proprietor at all. Even so, while dealing with the question of limitation the Privy Council made certain observations and it is those observations which are pressed into service by the learned Attorney General. Article 144 on which the respondent relied in that case, it has been held, is applicable only to a possessory suit by the owner of the property claimed against a person holding adversely to him without title, and the plea made by the respondent that he was the owner on several grounds was rejected; but in the course of its judgment the Privy Council assumed that by reason of the contract pleaded by the respondent the properties were impressed with the continuing trust in favour of the respondent, and observed that even so their Lordships were unable to hold that "this would entitle him to sue for possession as owner". Sir George Lowndes, who delivered the judgment of the Board, referred to the fact that "the Indian law does not recognise legal and equitable estates. By that law, there can be but one owner, and where the property is vested in a trustee, the owner must, their Lordships think, the trustee, and so the right of a beneficiary is, in proper case, to call upon the trustee to Convey to him". It is in that connection that Sir George Lowndes further observed that the enforcement of this right would, their Lordships think, be barred after six years under article 120 of the Limitation Act, and if the beneficiary has allowed this period (1) PAT. 851 221 to expire without suing he cannot afterwards file a possessory suit, until conveyance he is not the owner. It is clear that such a trust as is relied upon in the present case would not fall within s.10 of the Limitation Act as it would be impossible to hold that the properties which vested in the appellant under the terms of the wills which have been proved were so vested for the specific purpose of making them over to the respondent". It would thus be seen that these observations mean no more than this that the beneficiary under a private trust cannot claim to recover possession of the property from the trustee so as to attract the application of article 144 of the Limitation Act. He can make the claim for a declaration which would be governed by article 120. It is quite clear that the question as to whether in a proper case the beneficiary can. not apply for the removal of the trustee, for the appointment of a new trustee, and for the delivery to the new trustee of the property improperly alienated by the previous trustee did not fall to be considered in that case. All that the Privy Council was called upon to consider was whether a beneficiary can bring a suit for possession against a trustee and whether such a suit can be governed by article 144; and in holding that such a suit cannot be brought by the beneficiary the Privy Council pointed out that article 144 postulates a suit by the owner and a beneficiary is not an owner under the Indian Law of Trusts. We are, therefore, satisfied that the observations on which reliance is placed by the learned Attorney General cannot be said to amount to a decision that in no case can a beneficiary claim that the trustee appointed under the trust should be removed and new trustee should be appointed and the trust properties improperly alienated by the previous trustee should be ordered to be delivered into the possession of the new trustee. Section 63 no doubt provides for the two remedies which are available to the beneficiary, but in our opinion 222 section 63 cannot be treated as exhaustive on the subject and so it cannot be urged that a claim for constructive possession like the one made in the present suit is prohibited by 8. 63. Prima facie section 10 of the Limitation Act seems to contemplate an action by a beneficiary under a trust to which 8. 10 applies and provides that in such an action the beneficiary may follow the property and ask for a proper order &8 to the delivery of the said property to the Dew trustee. If that be so, the provisions of section 10 would suggest that the remedies prescribed by 8. 63 are not exhaustive. Besides, it would be relevant to observe that if section 63 is held to be exhaustive as to the remedies available to & beneficiary it would lead to very anomalous results. If a trustee improperly alienates the trust property the only remedy which would on that view be available to the beneficiary is to obtain a declaration. How would this declaration be effective to bring back to the trust the property improperly alienated? Strictly and literally construed section 63 dose not refer to the remedy for the appointment of a new trustee either, so that on a literal construction of section 63 even that remedy may be outside its purview but assuming that a beneficiary can ask for a declaration that the property alienated is impressed in the trust and also add a prayer for the appointment of a new trustee that only means that after the new trustee is appointed he will have to sue the alienee for possession and very often this suit would be defeated by the alienee 's plea of adverse possession. It is hardly necessary to emphasis that when the beneficiary sues for a declaration as required by section 63 and the alienee resists the said suit the adverse possession of the alienee is emphatically brought out and the pendency of the beneficiary 's suit would not affect that position so that on the view that a. 63 is exhaustive more often than not the beneficiary 's claim would in substance be defeated by the adverse possession of the alienee. 223 In Subbaiya Pandaram vs Mahamad Mustapha Maracayar (1), this is exactly what happened. In, the presence of the purchaser it was declared that the trust have been validly created and that the property was in fact a trust property. Their Lordships pointed out that "at the moment when the said decree was passed the possession of the property was adverse and the declaration that the property had been properly made subject to the trust disposition, and therefore ought not to have been seized, did not disturb or affect the quality of his possession ; it merely emphasised the fact that it was adverse. No further step was taken in consequence of that declaration until the present proceedings were instituted when it was too late. " We would like to add that if for bringing back to the trust the properties improperly alienated by the trustees two suits are required to be filed we apprehend that the second suit by the newly appointed trustee for obtaining possession of the properties would almost always be too late, and so section 63 cannot be read as exhaustively dealing with all the remedies available to the beneficiary. We must, therefore, reject the argument that the suit for possession in the form in which the prayer has been made by the plaintiffs is incompetent. That takes US to the question of res judicata. The argument is that on general grounds of res judicata the dismissal of the suit (O. section No. 30 of 1943) filed by defendants 1 to 6 should preclude the trial of the present suit. It has been fairly conceded that in terms section 11 of the Code cannot apply because the present suit is filed by the creditors defendants 1 to 6 in their representative character and it conducted as a representative suit under o. 1, r. 8; and it cannot be said that defendants 1 to 6 who were plaintiffs in the earlier suit and the creditors who have brought the present suit are the same parties or parties who claim (1) [1923] L.R 50 I.A. 295. 224 through each other. Where section 11 is the thus inapplicable it would not be permissible to rely upon the general doctrine of res judicata. We are dealing with a suit and the only ground on which res judicata can be urged against such a suit can be the provisions of section 11 and no other. In our opinion therefore, there is no substance in the ground that the present suit is barred by res judicata. The next question which falls to be considered is the most important question in these appeals. We have already seen that three trustees were appointed under the trust deed executed by defendants 1 to 6 and two of the impugned sale deeds have been executed by only two out of the said three trustees. The Courts below have held that two out of the three trustees could not convey a valid title and so on that ground alone the two transfers are invalid. It is urged before us that this conclusion is not justified on a fair and reasonable construction of cl. 23 of the trust deed. fore considering this point it is necessary to state the legal position in the matter under the Trusts Act. Section 48 of the Trusts Act provides that when there are more trustees than one, all must join in the execution of the trust, except where the instrument of trust otherwise provides. It is thus clear that all acts which the trustees intend to take for executing the trust must be taken by all of them acting together. Therefore, there can be no doubt that if the validity of the alienations effected by the trustees falls to be considered only in the light of section 48 the fact that out of the three trustees only two have executed the sale deeds would by itself make the transactions invalid and would not convey title to the alienees. This position is not in doubt. Lewin on "Trusts" has observed that "in the case of co trustees the office is a joint one. Where the administration of the trust is vested in 225 Co trustees they all form as it were but one collective trustee, and therefore must execute the duties of the office in their joint capacity. it is not uncommon to hear one of several trustees spoken of as the acting trustee but the Court knows no such distinctions, all who accept the office are in the eyes of the law acting trustees. If anyone refuses or be incapable to join it is not competent for the others to proceed without him, but the administration of the trust must in that case devolve upon the Court. However, the act of one trustee done with the sanction and approval of a co trustee any be regarded as the act of both. But such sanction or approval must be strictly proved (1) If one of the trustees refuses to join in the execution of the trust, under the Indian law section 34 of the Trusts Act provides for the remedy. The other trustees can apply to the Court as contemplated by 8. 34 and the trust may accordingly be executed. As we have seen section 48 contemplates that its provisions will not apply where the instrument of trust otherwise provides. In other words, if a trust deed under which more trustees than one are appointed expressly provides that the execution of the trust may be carried out not by all but by one or more then of course the matter world be governed by the special provision of the trust deed. The argument urged by the learned Attorney General is that cl. 23 of the trust deed in suit makes such a provision. Both the Courts below have rejected this plea but it is urged that the said conclusion is based on a misconstruction of the relevant clause. Clause 23 has been thus translated by the High Court: "In all the proceedings to be taken in connection with this estate, you three, either unanimously or according to the decision of the majority, shall act". In the earlier litigation stated by defendants 1 to 6 this clause was thus translated: (1) Lewin on trusts, 15th ed., p. 190. 226 "All the steps to be taken in connection with this estate should be according to the unanimous opinion of all the three of you or as decide(1) by the majority". The learned trial judge has made this translation of the clause in the present proceedings: "In all the proceedings to be taken in connection with the estate all the three should act either unanimously or according to the decision of the majority". The learned Attorney General has supplied us with the literal translation of the clause which reads thus: "In connection with this estate, in all proceedings to be taken you three unanimously or according to the decision of the majority shall act". We have carefully compared all the translations, and we feel no difficulty in holding that the translation supplied in the earlier litigation is somewhat inaccurate, whereas all the three translations made in the present proceedings substantially agree. Taking the translation supplied by the learned Attorney General it is clear that what this clause requires is that the three trustees shall act, and it provides that they shall act according to the decision which may be reached either unanimously or by majority. "You three," that is to say the three trustees, is the subject of the predicate shall act"; and the words between the subject and the predicate indicate how the decision has been reached. Reading the clause as a whole it is difficult to accept the argument that this clause allows two of the three trustees to act without joining the third trustee in the actual action to be taken in the execution of the trust. It is not necessary under the clause that in the matter of executing the trust every decision must he unanimous. The clause recognises that in some matters decision may be by majority; but nevertheless it requires that once a decision is reached either unanimously or by majority, in giving effect to the decision and in taking any given action in the execution of the trust all the three must act. Thus read this clause conforms to the statutory provision 227 contained in 8. 48 of the Indian Trusts Act and is not intended to provide for an exception to the said provisions at all. It is urged that if no departure was intended to be made from the principles laid down in section 48 the clause need not have been added at all. This argument is wholly inconclusive. There are General other clauses in the trust deed which also bring out provisions corresponding to the relevant provisions of the Trusts Act and this argument may apply to the said clauses as well. The authors of the trust, while creating the trust, have made elaborate provisions in respect of the trust, while creating the trust, leave made elaborate provisions in respect of the several matters concerning the execution of the trust, and the whole scheme of the trust deed is consistent with the operative cl. 23 in that it seems to require all the trustees to act together even though the decisions which they seek to give effect to may have been majority decisions and not unanimous decisions. Therefore, in our opinion, the Courts below were right in holding that cl. 23, like the main provision of section 48, requires that all the trustees should have joined in the execution of the sale deeds in question. That being so, Exs. :B 91 and B 37 which are respectively executed in favour of defendant 14 and defendant 13 are invalid and can pass no title to the alienees on the ground that only two out of the three trustees have executed them [Vide: Lala Man Mohan Das vs Janki Prasad (1)]. In support of the validity of these transfers an alternative argument has been urged before US. It is pointed out that according to Lewin on Trusts, if the act to the two trustees has been done with the sanction and approval of the third trustee then it may be regarded as an act of the three trustees, and it is urged that in the present case the third trustee had consented and shown his approval to the transactions in question. The two sale deeds have been executed by defendant 7 and Veerabahu (6) [1944] L. R. 72 T. A. 39. 228 Pillai, and they do not bear the signature of Narayana Pillai but this. alternative contention proceeds. on the assumption that though Narayana Pillai did not sign the document (exhibit B 94) he had in fact consented to it and had shown his approval to the transaction. This argument, however, cannot be accepted having regard to the concurrent finding recorded by the Courts. below on this point. Dealing with this question the trial court has referred to the discrepant versions given for Narayana Pillai not joining in the execution of the sale deed. He points out that no mention is. made in the sale deed as regards. the circumstances under which the third trustee did not join. Then he examines the evidence given by defendant 7 and points out the infirmities in the said evidence. He compares. the evidence given by defendant 13 in the previous. suit and observes that the explanations. given are inconsistent. One of the explanations was that Narayana Pillai declined to come to the Sub Registrar 's office as he was. heavily involved and that people would think that he was selling his. property. The other explanation was that Narayana Pillai wanted come accommodation, and when his co trustees refused to agree he declined to join the execution of the document. The trial court has observed that there was nothing to show that Narayana Pillai was financially involved at the relevant time, and he points. Out that in fact Narayana Pillai had gone to the sub Registrar 'section Office near about that time in connection with another transaction. That is how the trial court has rejected the argument that Narayana Pillai was a consenting party to the transaction in question. The High Court has concurred with this conclusion. In dealing with this question the High Court has preferred to believe the evidence of the first defendant that Narayana Pillai considered the prices fixed for exhibit B 94 as very low and for that reason refused to be a party to it. It has contrasted this reason with the other reasons given on behalf of the alienees, and it has recorded its conclusions in these words: 229 "Whatever may be the reason it is certain that Narayana Pillai was not a consenting party to the transaction and there being no other evidence by way of minutes of any meeting of the trustees had decided with the knowledge of Narayana Pillai, though he had dissented, we are unable to hold that there has been such a decision of the majority as would bind the dissenting trustee". It does appear the original draft of exhibit B 94 was made on the assumption that all the trustees would join in the execution of the document but the hope and anticipation formed by the two trustees was believed and so the document was ultimately executed by two of them without Narayana Pillai joining. We have considered the evidence to which our attention was invited in this connection, and we see no reason to interfere with the concurrent conclusion recorded by the Courts below that Narayana Pillai was not a consenting party to the transfer in question. 'that being so, the alternative ground made in support of exhibit B 94 fails. If the transfers in favour of defendant 14 (exhibit B 94) as well as Ex;. B 37 in favour of defendant 13 fail on this ground it is really not necessary to consider the further question as to whether both the said transfers were effected for grossly inadequate consideration. The next question which has been raised on behalf of defendant 14 is in regard to the amendment made by the High Court in its decretal order. It is urged that this amendment was made after the appeals to this court had been admitted and so it is without jurisdiction. It appears that the certificate was granted by the High Court to the respective defendants who have come to this Court as appellants on November 26, 1954, and the appeals were admitted on December 4, 1955, whereas the amendment has been made after the appeals were admitted. The application for the amendment in question was made under section 151 and 152 of the Code; and it became necessary because the decretal order drawn in the High Court referred to the profits 230 of which accounts were directed as mesne profits. The use of the words "mesne profits" would have inevitably brought ill the period of three years beyond which accounts could not be claimed. By r J their application the plaintiffs alleged that the use of "mesne profits" in the decretal order was inconsistent with the judgment which had directed accounts of the net profits as so they claimed that the decretal order should be corrected in cl. III, sub cl.(3). According to the prayer thus made it was suggested that the clause should read as follows "that the defendants 12, 13 and 14 are liable for the net profits of the properties purchased by them under schedule V, schedule II and schedule I respectively" The word "net profit" was used in the place of "mesne profits" originally introduced ill the order. When this application for amendment was argued before the High Court the defendants pleaded that the use of the words "mesne profits" was proper and should not be changed. It was urged on their behalf that in its judgment the High Court had introduced the words "mesne profits" deliberately and so the decretal order was perfectly correct. This contention has been negatived by the High Court, and in our opinion rightly. It appears that in the earlier portion if his judgment Krishnaswami Naidu, J., summarised ill one paragraph the effect of the decree passed by the trial court; and in giving this summary he observed that under the decree defendants 12, 13, 14 and 16 were held entitled to be paid the respective considerations of the sales and mortgages together with interest they being liable to account for mesne profits as per the terms of the decree. Two things are clear. Th s part of the judgment does not contain the decision of the High Court at all. It is really concerned with the narration of the relevant facts and it purports to summarise the effect of the decree and nothing more. Besides, the use of the words "mesne profits" in the context is obviously the result of inadvertence because the decree of the 231 trial court had in the relevant clause used the words "net profits" and not "mesne profits". Thus, there can be no doubt that the decretal order drawn in the High Court through error introduced the words "mesne profits" and such an error could be corrected by the High Court under sections 151 and 152 of the Code even though the appeals may have been admitted in this Court before the date of correction. But apart from this technical argument about the jurisdiction of the High Court to make the correction the point in question has been raised on the merits before us; and it is urged that the plaintiffs are not entitled to anything more than three years ' profits from the respective defendants. The argument is that article 109 of the Limitation Act applies to such a claim and the claim is confined to three years under that article. Article 109 deals with claims for profits of immovable property belonging to the plaintiffs which have been wrongfully received by the defendants and it prescribes there years ' period of limitation commencing from the time when the profits were received. Normally there is no doubt that a successful plaintiff would be entitled to mesne profits for three years and not more; but in the present case we are dealing with a claim made by the plaintiffs on behalf of the trust and the decision in their favour has rendered it necessary to adjust equities between the trust and the respective alienees alienations in whose favour have been set aside as invalid. We have already seen that having set aside the alienations in favour of defendant 14 and others the Courts below have directed that the alienees should get the amounts due to them from the trust. It has also been directed that interest at the rate awarded by the decree should be paid to them on the said amounts. This clearly is an equitable relief granted to the alienees. Having held that the alienees should get interest on the amounts due to them from the dates of their respective mortgages or 232 sales the Courts in fairness have directed that the alienees in turn should give an account of the net profits of the properties which were wrongfully in their possession commencing with the date when 7 they got possession. If the technical argument based on article 109 is upheld as a matter of law there would be no scope for giving equitable relief to the alienees as all and they may be driven to file fresh actions to recover their claims and such actions would have to face the possible plea of limitation. That is why the High Court has observed that the question about the net profits awardable to the trust and interest awardable to the alienees involves considerations of equitable adjustment, and it is by way of an equitable adjustment that the relevant directions have been issued by the decree. It is not disputed that the Court had jurisdiction to make such an equitable adjustment. Indeed, in many cases of this type Courts have made equitable adjustments between rival parties Vide: Satgur Prasad vs Har Narain Das (1); Bhagwat Dayal Singh vs Debi Dayal Sahu (2). The principal and interest ordered to be paid to defendant 14 and the profits ordered to be paid by him are thus integral parts of on equitable adjustment between the plaintiffs and defendant 14. It is also urged on behalf of defendant 14 that the High Court was in error in modifying the decree passed by the trial Court by changing 10 1/2% interest at compound rate to 10 1/2% simple interest in favour of defendant 14. The contention if that under the mortgage executed in favour of defendant 14 (Erg. B 95) the contract rate was 101 compound interest and as mortgagee defendant 14 was entitled to that rate. In support of this argument reliance is placed on the decision of the Privy Council in Jagnnath Prasad Singh Chowdhury vs Surajmal Jalal (a). In that case the Privy Council has held (1) (1932) L. R. 59 1. A.A. 147. (2) (1908) L. R. 35 I. A. 48, 59. (3) (1926) L.R. 54 I. A. 1. 233 that on a preliminary decree for foreclosure or sale under O. XXXIV ,rr. 2, 4 of the Code, a mortgagee is entitled to interest at the rate and with the . rests stipulated in the mortgage, down to this date filed for redemption by the decree. This position 6 cannot be disputed; but the answer to the plea is that the present decree is not passed in an action instituted by defendant 14 as a mortgagee. The present decree is passed while adjusting equities between defendant 14 the alienation in whose favour is set aside; his rights as mortgagee are equitably recognised and thereby further litigation is avoided. Since the decree by which defendant 14 is allowed to recover his mortgage dues has been passed for giving him equitable relief it was open to the High Court to consider whether compound interest should be paid to him or not. As the High Court has pointed out, while adjusting equities between the parties the mortgage does not become revived as such but the relief granted to the 14th defendant is based on equity and justice, and so the High Court thought that the interests of justice would be met if he is paid out of the sale proceeds the principal amount of the mortgage with simple interest at 10 1/2%. We have carefully considered the contention ' raised by the learned Attorney General in this behalf but we do not think that we would be justified in interfering with the modification made by the High Court in the decree passed by the trial court. In the result Civil Appeal No. 62 of 1959 files by defendants 14 and 18 to 24 fails and is dismissed with costs. We now turn to Civil Appeal No. 77 of 1959 filed by defendants 12, 13 and 16. We will take the case of defendant 12 first. We have already seen that in favour of defendant 12 a sale deed has been executed on November 7, 1941 (exhibit B 90). This sale deed has been set aside on two grounds one that it is executed in favour of a person who by intermeddling with the estate of the trust has 234 become trustee de son tort, and second that the properties covered by the document have been sold for inadequate consideration. It is conceded by Mr. Ganapathy Iyer that if we confirm the J finding recorded by the Courts below against defendant 12 on the first point that it self would invalidate the transfer in his favour. He has, however, argued that the said finding is erroneous. Having carefully considered the relevant material we see no reason to interfere with the finding in question. In this connection it would be enough if we briefly refer to the relevant evidence bearing on this point. Defendant 12 wrote to Pichu Ayyar Avergal, defendant 15, who was a clerk of the trust estate on August 20, 1936, in these words: request you that Pathai properties may be checked, that Piramanayakam Pillai coming (there) may be consulted with regard to all matters and settlement made and that you may also come here on Monday morning and render necessary assistance". The tone of the communication and its contents are significant. It is not the language of a person who is merely assisting the trustee. He is issuing directions to the clerk of the trust. Defendant 12 was a creditor of defendants 1 to 6. It is, however, common ground that when sale deed (exhibit B.12) was executed in favour of defendant 13 on December 19, 1936, defendant 13 who is no other than the brother of defendant 12 had undertaken to satisfy defendant 12s debt and so as from that date defendant 12 had ceased to be a creditor of the estate. Even so, he was intermeddling with the estate throughout. On October 14,1938, he wrote to the Agent of the Travancore National and Quilon Bank suggesting that he would pay a sum of Rs. 10,000 for the entire amount payable to the bank by the debtors and he requested the Bank to have the debt discharged in that manner. Then he added that "as the price of the lands have gone down very much owing to conditions at the present time" he requested that the sum of Rs. 10,000 may 235 be received and that the entire debt should thus be discharged. It, would be noticed that at this date defendant 12 was not a creditor of the estate and he had, therefore, no business to write to the Bank. This letter, like the earlier one which we have already seen, clearly indicates that defendant 12 had taken it upon himself to administer the trust. To the same effect is another letter written by him to the official Liquidator of the said Bank on January 9, 1939. In this letter defendant 12 says that "the trustees are arranging for several settlements in deference to the wishes of Mr. Ayyah Sastri, but owing to the nature of time the matter stands unsettled even though both are agreed willingly ". Then he refers to the proposal to settle all the debts and promises that "the matter will be finally settled if the trustees meet you personally". "I, therefore, request you ', says defendant 12, to kindly excuse the little delay and pray to fulfill the great task", and he adds " I am also coming there". Then followed a suit by the Bank, No. 12 of 1939 to which defendants 12 and 13 were impleaded and in this suit defendants 12 and 13 entered into a compromise with the plaintiff Bank and obtained a compromise decree. It is unnecessary to refer to the terms of the compromise decree. What is material is the conduct of defendant 12 in entering into compromise with the Bank. Defendant 13 may have been justified in entering into the compromise but defendant 12 could have done to only as an intermeddler. This decree was passed on February 14, is also relevant on this point. This is a notice issued to defendant 12 by one of the creditors of the estate. It appears that this creditor had given to defendant 12 a receipt signed by him in order to enable defendant 12 to draw the amount from defendant 14 to be paid to the said creditor. The notice further recites that "it now transpires that about the middle of July, 1937, you drew the said amount of Rs.455 from the said Janakirama Iyer and have 236 failed till now to account for the same to my client". In other words, this notice shows that defendant 12 had promised to pay to the creditor Rs. 425 due to him from the estate and had failed to do so. The result was the suit by the creditor (Small Cause Suit No. 58 of 1940). This suit again was compromised by defendant 12. There is yet another document Ex 121 which shows how defendant 12 was intermeddling with the estate. This is a receipt passed by the clerk of the estate to one Subbayyar Avergal on March 9, 1937. It reads thus: "According to the order directed by defendant 12 I have received from you on this date Rs. 400 from the sale of the current Pisanam paddy produce from the estate of M. R. Ry. P.S. Krishnaswami Ayyar Avergal vagaira, Kalakkadu Pannai". It is clear that the clerk of the estate Pichandi Ayyar who passed the receipt had been directed by defendant 12 to receive Rs.400 from Subbayyar Avergal. The had accordingly received that amount and passed a receipt in that behalf. Now, is. defendant 12 directed the clerk of the estate to receive a certain amount for and on behalf of the estate it clearly amounts to intermedding with the estate and it makes him trustee de son tort. Defendant 12 had given evidence in the earlier litigation in which he had stated that he, defendant 13 and Veerabahu Pillai were members of an undivided family. In the present proceedings defendant 12 has gone back upon his admission that he and his brothers constituted an undivided family. The trial court has accepted this latter plea and the High Court has not differed from it; but that apart, the several statements made by defendant 12 in the said evidence clearly show that he was taking as much active part in the affairs of the trust as his brother Veerabahu. There is yet another fact to which reference may be made. As the High Court has pointed out, the sale in favour of defendant 12 was executed on 237 November 7, 1941, and yet the properties covered by the said document appear to have been put in his possession as early as 1937. In other words, defendant 12 entered into possession of the properties nearly four years before the sale was executed in his favour. It is in the light of these facts that the Courts below have held that defendant 12 is a trustee de son tort. As is observed is Williams on Executors and Administrator(1) "a very slight act of intermeddling with the goods of the deceased will make a person executor de son tort". In the present case the acts of intermeddling by defendant 12 spread over a fairly long period and cannot in any sense he regarded as minor and insignificant. We would accordingly hold that defendant 12 is in the position of trustee de son tort and to the sale deed executed in his favour (Ex. B 90) is bad on that account alone. In regard to defendant 13 there are two transactions in his favour, exhibit B 37 and exhibit exhibit 37, as we have already seen, is invalid for the reason that it has been executed by two out of the three trustees. That leaves exhibit B 79; but before we deal with that transaction it would be relevant to refer to a general consideration which applies to all the transfers in favour of defendants 12, 13 and 16. Defendants 12 and 13 are the step brothers of Veerabahu and defendant 16 is the son in law of defendant 13. It is quite clear that under section 52 of the Trusts Act "no trustee whose duty it is to sell trust property, and no agent employed by such trustee for the purpose of the sale, may, directly or indirectly, buy the same or any interest therein, on his own account or as agent for a third person". This position is thus stated by Lewin on Trust: "A trustee is absolutely and entirely disabled from purchasing the trust property whether it be real estate or a chattel personal, land, or a ground rent, in reversion or possession, whether the purchase be made in the trustee 's own name or (1) Williams of Executors and Administrators, 14th ed. , Vol. 1, p. 28, 238 in the name of a trustee for him, directly or indirectly, as to a purchaser upon a contract or understanding (amounting to more than mere expectation) that the purchaser shall re sell to the trustee, by private contract or public auction, from himself as the single trustee, or with the sanction of his co trustees(1). Thus, the alienations by the trustees in favour of the near relatives of one of the trustees would be bad for this reason. Besides, under section 47 of the Indian Trusts Act a trustee cannot delegate his office or any of his duties either to a co. trustee or to a stranger, unless the instrument of trust so provides, or the delegation is in the regular course of business, or the delegation is necessary, or the beneficiary, being competent to contract, contents to the delegation. The trust did impose upon the trustees the obligation to sell the properties of the trust at the highest price recoverable and to distribute the sale proceeds amongst the creditors of the authors of the trust. The documents in favour of defendants 13 and 16 seem to leave it to the respective purchasers to pay the debts and that map be another infirmity in the transaction. Going back to exhibit B 79 which is a transfer in favour of defendant 13 it is evident that this transaction is inevitably connected with another transaction exhibit B 25. exhibit B 79 has been executed for a consideration of Rs.2,000 and odd and it relates to 3 acres and 14 cents of schedule VIII property. It appears that defendant 13 had obtained another sale deed exhibit B 25 on April 19, 1937 This sale deed consisted of 51 items of property belonging to the trust which had spread over five villages. These items consisted of house sites and lands. The sale deed was for Rs. 5,000. Defendant 13 in his turn proceeded to sell the said property by different lots to respective buyers. Amongst the creditors of the estate was Lakshmi (1) Lewin on Trusts, 15th ed, p. 797. 239 Ammal to whom Rs. 800 was payable on the basis of 50% of return of debt. Defendant sold to I. Lakshmi Ammal 64 cents out of the lands purchased by him under exhibit B 25. It, however, appears that in respect of the 3 acres and 14 cents which ,7 was the subject matter of exhibit B 25. Original Suit No. 32 of 1941 was instituted by persons who claimed title to the said property. To that suit Lakshmi Ammal was impleaded as to defendant and so was defendant 13. Ultimately the said suit was decreed and the property in question was held to belong to the plaintiffs in that suit and not to the estate of defendants 1 to section It was as a result of this decree that exhibit B 79 came to be passed in favour of defendant 13. This document purports to convey 3 acres and 14 cents of another property to make good the lose to him by reason of the decree in Suit No. 32 of 1941. Thus, it would be seen that the transaction evidenced by exhibit B 70 can stand only if the transaction by evidenced by exhibit B 26 is valid and not otherwise. The Courts below have held that this latter transaction is obviously and patently invalid. In our opinion, this conclusion is right. It is true that exhibit B 25 is not directly challenged in the present suit because the properties covered by it have been sold to different purchasers by defendant 13 and they have not been impleaded. Even so, since exhibit B 25 is the very foundation of exhibit B 79 it is open to the plaintiffs to contend that the validity of Ex 26 should be considered for determining the validity of exhibit B 79, and that is what the Courts below have done. Now, one has merely to look at the broad features of exhibit B 25 to be satisfied that it is an invalid transaction. It is patent that no attempt was made to value the properties individually. The properties numbering 51 and spread over five villages were all grouped together and sold for Rs. 5,000 without making any serious efforts to determine the value 240 of the lot. The purchaser was told to sell the properties to the respective creditors of the estate and thus satisfy them. The in substance is delegation of the functions of the trustees which they could not J delegate to defendant 13. The stamp paper for the sale deed exhibit B.25 stands in the name of Veerabahu Pillai and defendant 13 was unable to explain how the stamp paper came to be in that name. Defendant 13 admitted that he did not inspect the property before its purchase and that he had no idea about its value. As the trial court had observed, the transaction cannot be regarded was a bona fide sale because the property consists of odd assortment of punja lands and house sites in Pathi, Padmaneri and Sivalpuri villages". Therefore, we have no difficulty whatever in agreeing with the conclusion of the Courts below that exhibit B 25 was invalid; if that be so exhibit B 79 must be held to be invalid for that reason alone. Incidentally, we may refer to the fact that defendant 13 admitted in the earlier suit that he had not refunded the purchase money to Lakshmi Ammal and that substantially destroys the basis of exhibit B 79 because defendant 13 not having paid anything to Lakshmi Ammal had no right to retain the property conveyed to him. The last transactions which have yet to be examined are those in favour of defendant 16. In regard to these transactions the trial court has found that evidence adduced by the plaintiffs shows that the consideration for which properties were sold were grossly inadequate. The vendee, defendant 16, did not care to examine himself. Besides, as we have already pointed out he is a close relation of defendants 12 and 13. The High Court has concurred with the trial court 's conclusion. The only point which was attempted to be made by Mr. Pattabhiraman in challenging the correctness of this concurrent conclusion is that the Courts appear to have assumed that the agricultural lands conveyed to defendant 16 were all double crop lands. On this assumption he suggested that . 241 the calculation made about the true value of the said properties errs on the side of overstatement. It is not disputed that of the lands conveyed 3 1/2 acres and 24 cents are single crop while approximately 3 acres are double crop. On looking at the judgments of both the Courts below, however, we are satisfied that the argument is misconceived because neither judgment proceeds on the assumption that the whole of the agricultural property is double crop land. In fact the discussion in the judgment of the trial court on Issue No. 27 quite clearly negative the assumption made by Mr. Pattabhiraman. that being so as the Courts below have observed, evidence led by the plaintiffs in support of their case that the transfers were effected for grossly inadequate price has remained unrebutted. The question about the value of the property has been determined on the evidence, documentary and oral, led in the case, and both the Courts have found in favour of the plaintiffs and against the alienees. Incidentally, we may point out that Mr. Viswanatha Sastri appears to be right when he suggests that schedule VII refers to the properties both at Thirukurunkudi as well as Padmaneri though the heading of the schedule refers only to Thirukurunkudi. In the result Civil Appeal No. 77 of 1959 preferred by defendants 12, 13 and 16 fails and is dismissed with costs. Appeals dismissed.

These appeals arose out of a representative suit filed on behalf of the creditors of defendants I to 6 who hat executed a trust deed on August 26, 1936, conveying their properties to three trustees with authority to dispose of the one and distribute the ale proceeds ratably amongst the creditors. The trust deed required "the three trustees to act according to the decision arrived at either unanimously or by majority." The trustees accepted the trust and conveyed all the properties except the family house in administration of the trust. Two of the sale deeds in favour of two of the creditors, defendants 13 and 14, a mortgagee creditor, in the suit were executed by only two or the trustees . In a suit brought by the said defendants 1 to 6 for administration of trust the trial court passed a preliminary decree. The High Court on appeal remanded the matter to the trial court for a finding as to the market value of the lands sold. The trial court submitted its finding. At this stage defendants 1 to 6 withdrew the suit which we dismissed. The present suit under O. I, r. 8 of the Code of Civil Procedure we filed on October 29, 1947, before such withdrawal. The claimed made therein, inter alia, were for a declaration that the properties in question were still impressed with the trust, for the removal the surviving trustee and appointment of an a administrator to realise the amount, recover position of the properties and re sell them. The trial Judge passed a decree infavour of the plaintiffs . The High Court in substance confirmed that decree but modified it by awarding simple interest 207 instead of compound Interest decreed in favour of defendant 14. The two sale deeds, executed by only two of the trustees, were declared invalid and it was found that the third trustee did not give his consent to it. The sale deed in favour of defendant 12 was declared invalid on the ground that he had intermeddled with the trust estate and had thus become a trustee de sou tort. The courts below also rejected the pleas of limitation and res judicata raised on behalf of the defendants. Some of the creditor detendants appealed. After the appeals had been admitted by this Court the High Court amended the decretal order by substituting the words 'mesne profits ' by 'net profits ' under sections 151 and 152 of the Code of Civil Procedure. ^ Held, that the question whether article 120 or article 134 of Indian Limitation Act applied to a case had to be decided on the case made in the plaint, read as whole and properly construed. Since the present suit was not one for a mere declaration but for possession of property, having been valued and framed as such, deliverable to the administrator, it was governed by article 134 and not by article 120 of the Act and was thus within time. It was not correct to say that section 63 of the Indian Trust Act was exhaustive as to the remedies available to a beneficiary under a private trust or that claim for constructive possession, such as was made in the present suit, was prohibited under that section. Rani Chhatra Kumari Devi vs Prince Mohan Bikram Shah, Pat. 851, distinguished. Subbaiya Pandaram vs Mohammad Mustapha merachayar , (1923) L. R. 50 IE A. 295, A Subramania Iyer vs P. Nagarathna Naicker , (1910)20 Mad. L. J. 151 and Masjid shahid Ganj vs Shiromani Gurdwara Prabandhak Committee Amritsar (1940) L. R. 67 I. A. 251, referred to. Nor could the suit be said to be barred by res judicata since it did not fall within the scope of section II of the Code of civil Procedure. The suit being one under o. 1, r. 8 of the Code, it could not be said that defendants I to 6, plaintiff in the earlier suit, and the creditors, plaintiffs in the present suit, where the same party or parties claiming through each other. Clause 23 of the trust deed, properly construed, conformed to the provision of section 48 of the Trusts Act that where there are more trustees than one, they must all join in the execution of the trust, and did not provide for an exception to that rule, even though it provided that decisions by the trustees need not a ways be unanimous but could be by majority as well. Such sale deeds as had been executed by 208 two of the trustees only must therefore fail. The alternative. case of consent given by the third trustee to the transaction could be of no avail since it could not be substantiated by evidence Lala man Mohan Das vs Janaki Man Prasad, (1944) L. R. 72 I. A. 39, referred to. The High Court had jurisdiction under sections 151 and 152 of the Code of Civil Procedure to correct the obvious error in the decretal order even though the appeals from the said decree had already been admitted by this Court. Nor could the amendment be challenged on merits. Although a successful plaintiff would not normally be entitled to mesne profits for more than three years in view of article 109 of the Limitation Act, the court had jurisdiction in the case of a trust to make appropriate direction in the decree, while awarding net profiles to the trust and interest to the mortgagee, in adjustment of the equities between them. Salgur Prasad V Har Narain Das (1932) L.R. 59 I. A. 147, Bhagwat Dayal Singh vs Debi Dayal Sahu, (1908) L. R. 35 I. A. 48 and Jagannath Prasad Singh Chowdhury vs Surajmal Jalal , (1926) L. R. 54 I. A. 1, referred to. Even slight intermeddling with the trust estate is sufficient to make a person trustee de son tort. Since in the instant case, the acts of intermeddling by one of the defendant covered a fairly long period, the courts below were right in holding that the sale in his favour must be set aside as one in favour, of a trustee de son tort.

n No. 96 of 1955. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. Purushottam Tricumdas, J. B. Dadachanji Ravindra Narain and O. C. Mathur, for the petitioner. C. K. Daphtary, Solicitor General of India, B. R. L. Iyengar and T.M. Sen, for the respondents. October 23. The Judgment of Sinha, C. J., Das, Sarkar and Ayyangar, JJ., was delivered by Das, J. Mudholkar, J., delivered a separate Judgment. section K. DAS, J. This is a writ petition on behalf of two petitioners. The first petitioner is the Board of Trustees, Ayurvedic and Unani Tibbia College, Delhi, through Hakim Mohammed Jamil Khan, stated to be its properly elected Secretary. The second petitioner is Hakim 159 Mohammad Jamil Khan himself, who states that he is still one of the trustees or members of the said Board. The petition was initially filed on behalf of the first petitioner. Subsequently, an amendment petition was moved which was allowed by us. As a result of the amendments allowed petitioner No. 2 was added as one of the petitioners, and certain new grounds of attack were added in para. 14 of the petition. To these grounds we shall advert later. The short facts giving rise to the petition are these. One Hakim Mohammad Ajmal Khan was a physician (of Unani medicine) of all India repute. He lived in Delhi and started a pharmaceutical institute in the town known as Hindustani Dawakhana in the year 1903. He also established a medical college known as the Tibbia College. He died in the year 1927. But before his death, in the year 1911, he along with certain other persons formed a society styled Anjuman i Tibbia and had it registered under the (Act XXI of 1860). The name of the society was changed in 1915, and it became known as the Board of Trustees, Ayurvedic and Unani Tibbia College, Delhi. For convenience we shall refer to it as the Board. The Board ran the Tibbia College ' and an attached hostel. The pharmaceutical institute was also managed by it, though at one stage petitioner No. 2 claimed the institute as his private property. Certain rules and regulations were made for the functioning of the Board, which were amended from time to time. The main objects of the Board were thus stated in the rules : (a) to establish colleges for the purpose of imparting higher education in the Unani and Ayurvedic systems of medicine to the inhabitants of India; (b) to improve the indigenous systems of medicine on scientific lines and for that 160 purpose to establish one or more pharmaceutical institutes (dawakhanas); and (c) to have medical books compiled and translated and to adopt other means which might enhance the popularity of those systems and add to the information of the people in general on hygiene etc. The maximum number of members (called trustees in the rule) was 35 to be elected from all the then Provinces of India. It was stated in r. 5 that one third of the members of the Board should be Hakims and Vaids. The financial year of the Board was to be from April 1 to March 31 of each year, and the annual subscription to be paid by a member of the Board was fixed at Rs. 12/ per annum payable in advance before April 30 of each year. Rule 6 laid down the circumstances in which the office of a member should be deemed to be vacant, and one of such circumstances was the failure of a member to pay him annual subscription before the date fixed for such payment. There were also rules regarding (a) power of inspection of the college, hostel etc., (b) ordinary meetings of the Board of Trustees and (c) matters which could be dealt with by the Board and its sub committees. It is not necessary to state these rules in detail. Rule 13 provided for the formation of a Managing Committee consisting of nine members and six officials for a period of three years and the functions of the Managing Committee were also prescribed in the rules. The office bearers of the Board and the Managing Committee were to be the same and consisted of (1) a President, (ii) a Senior Vice President, (iii) a Junior Vice President, (iv) a Secretary, (v) a Financial Secretary, and (vi) a Joint Secretary. It was laid down in r. 26 that the office bearers of the Board were to be elected for three years by the members. The rules also laid down the powers and duties of the President, 161 Secretary, Financial Secretary and Joint Secretary. One of the rules said that the office of the Secretary of the Board shall, as far as possible, vest in the lineal descendants of Hakim Mohammad Ajmal Khan. Hakim Mohammad Jamil Khan son of Hakim Mohammad Ajmal Khan and petitioner No. 2 before us, was the first Secretary of the Board. In the year 1948 Shri Rameshwar Dayal, the then Collector of Delhi, and Dr. Yudhvir Singh the then President of the Delhi Municipal Committee, and certain other persons were elected as members of the Board. Dr. Yudhvir Singh was elected President and one Shri Mool Chand Gagerna was appointed Joint Secretary. Soon after the elections in 1948, a struggle ensued between different groups of members for obtaining control of the Board and the college, and for possession of the Hindustani Dawakhana. Certain criminal proceedings followed. On October 18, 1949, a suit was brought in the court of the senior Subordinate Judge, Delhi under H. 92 of the Code of Civil Procedure against the Secretary and 31 members of the Board. In that suit an application was made for the appointment of a receiver and on October 19, 1949, the Subordinate Judge appointed two local advocate as joint receivers with plenary powers. These receivers took possession of the Dawakhana and the college between October 19 and 23, 1949. When the suit was still pending, the Delhi State Legislature passed an Act called the Tibbia College Act, 1952 (Delhi Act No. 5 of 1952), hereinafter referred to as the impugned Act. This Act same into fore on October 10, 1952. The constitutional validity of the Act is the principal question for decision on this writ petition and we shall presently refer to the provisions thereof. We may only state here that by section 9 of the impugned Act, the Board stood dissolved and all property, movable and immovable, and all rights, powers and privileges 162 of the Board vested in a new Board constituted under the Act. This new Board is called the Tibia Delhi College Board and we shall Refer to it as the new Board. After the passing of the impugned Act, the suit instituted before the Subordinate Judge, the Delhi was withdrawn. On the withdrawal of the suit, an application was made for making over possession of the properties to the new Board. That application was allowed in spite of the objection of petitioner No. 1. Petitioner No. 1 unsuccessfully moved the High Court of Punjab against that order. Thereafter, petitioner No. 1 moved this Court under article 32 of the Constitution for the issue of a writ restraining the State of Delhi and the newly constituted Board under the impugned Act, the State from enforcing the provisions of the impugned Act and the new Board from exercising any functions thereunder. The respondents to the petition raised a number of preliminary objections, and on December 13, 1954, the writ petition was withdrawn. This was followed by some amendments of the rules of the Board and it is stated on behalf of the petitioners that a fresh election was held in accordance with the amended rules on January 6, 1955. On January 11, 1955, the Managing Committee passed a resolution authorising the Secretary to institute a proceeding in this Court to enforce the fundamental rights of petitioner No. 1. The present petition was then filed on March 14, 1955, in pursuance of that resolution. The petition was subsequently amended in the manner already indicated by us. The State of Delhi and the new Board are the respondents to the present petition. The learned Advocate for the petitioners has challenged the validity of the Act on two main grounds. His first ground that the Delhi State Legislature had no legislative power or competence to enact the impugned Act, which must on that ground be declared invalid and inoperative. The second ground proceeds on the footing that assuming 163 the Delhi State Legislature had power to enact the impugned Act, the Act is bad because its several provisions violate the fundamental rights guaranteed to the petitioners under article 14, 19 and 31 of the Constitution. Two subsidiary points have also been urged before us, one to the effect that the Delhi State Legislature could not by the impugned Act over ride the provisions of the which is a Central Act, and the other to the effect that the Delhi State Legislature acted mala fide in passing the impugned Act. We shall presently deal with these arguments in the order in which we have stated them. It is necessary to state here, however, that a preliminary objection similar to the one urged against the previous petition was also urged in respect of the present petition. The learned Solicitor General appearing on behalf of the respondents has urged that by reason of the failure of the members to pay the annual subscription in time, all of them ceased to be members in 1950 1951; therefore, the elections held in 1955 were of no effect there being no one competent to elect; and the Board as a Board ceased to exist before 1955 and neither petitioner No. 1 nor petitioner No. 2 could maintain the present writ petition. Some of the affidavits made on behalf of the parties containing averments with regard to the payment or non payment of subscription particularly in the years 1949 50 and 1950 51 were read, and exhibit B. series which were the cash books of the years 1951 to 1954 were also placed before us. On one side there is the averment on behalf of the respondents that no subscriptions were paid before the due date for the years 1949 50 and 1950 51 by any of the members. As against this, it is stated on behalf of the petitioners that petitioner No. 2 and some of the other members paid their subscription to the Financial Secretary for the years 1949 50 and 1950 51. An affidavit made by the then Financial Secretary was also placed before us. From appeal of the affidavits 164 and the documents filed it appeared to us that the . question being one of disputed facts could not be satisfactorily decided on the materials placed before us. We, therefore, thought it proper and convenient to consider the legal points urged as regards the constitutional validity of the impugned Act and of the action taken thereon. Now, we take up the first argument advanced on behalf of the petitioners. This argument has been put in the following way. The State of Delhi became a Part State on the coming into force of the Constitution of India. Under article 239 of the Constitution as it then stood, a Part State was to be administered by the President acting, to such extent as he thought fit, through a Chief Commissioner or a Lieutenant Governor to be appointed by him or throughout the Government of a neighbouring State. Article 240 of the constitution enabled Parliament by law to create or continue for any Part State a body, whether nominated, elected or partly nominated and partly elected, to function as a Legislature for the State. By virtue of the power conferred by article 240, Parliament enacted the Government of Part a States Act, 1951 (Central Act 49 of 1951), by which a Legislative Assembly was constituted for some of the Part C States including one for Delhi. Section 21 of the said Act laid down the extent of legislative power of the Legislative Assembly. This section said inter alia that the Legislative Assembly of a Part a State may make laws for the whole or any part of the State with respect to any of the matters enumerated in the State List (List II) or in the Concurrent List (List III). There was an exception provided with regard to the Legislative Assembly of the State of Delhi in respect of public order, police etc., which is not relevant for our purpose. Section 22 said that if any provision of a law made by the Legislative Assembly of 0, Part State was repugnant to any provision of a law made by Parliament, then the 165 law made by Parliament, whether passed before or after the law made by the Legislative Assembly of the State, shall prevail and the law made by the Legislative Assembly of the State shall, to the extent of the repugnancy, be void. There is an Explanation to the section which is not 'relevant for our purpose and need not be read. The point which the learned Advocate for the petitioners has emphasised is that under section 21 aforesaid, the extent of the legislative power of the Delhi State Legislature was limited to the making of laws for the whole or any part of the Delhi State with respect to any of the matters enumerated in the State List or in the Concurrent List of the Seventh Schedule to the Constitution. Now, item 32 of the State List (List II) is in these terms: "32. In corporation, regulation and winding up of corporations, other than those specified in List I. and universities, unincorporated trading, literary, scientific, religious and other societies and associations; co operative societies. " Items 43 and 44 of the Union List (List I) are in these terms: 43. Incorporation, regulation and winding up of corporations, including banking, insurance and financial corporations but not including co operative societies 44. Incorporation, regulation and winding up of corporations, whether trading or not, with objects not confined to one State, but not including universities. " The argument of the learned Advocate for the petitioners is this. The old Board which was registered under the and is petitioner No. 1 before us, was a corporation, whose objects were not confined to the State of Delhi. Therefore, any legislation with regard to it could fall under item 44 of List 1 and not under 166 item 32 of List II. This argument consists of two parts first, that the old Board was a corporation, and, secondly, that its objects were not confined to one State. The learned Advocate urge that being the position, the Delhi State Legislature had no legislative competence to make the impugned legislation which went beyond the extent of its legislative power under 8. 21 of Act 49 of 1951. It is worthy of note here that if the Board were not a corporation, then the impugned legislation would not fall under item 44 of List I; alternatively, if the Board were not a corporation but its objects were confined to only one State, viz. the State of Delhi, then again item 44 would not be attracted. On behalf of the respondent there is a threefold reply to the argument stated above: firstly, that the Board was not a corporation; secondly, its objects did not extend beyond the State of Delhi; and thirdly, the impugned legislation is supportable under item 11 of List II relating to "Education" and item 28 of the Concurrent List (List III) relating to "Charities and charitable institution". The first and foremost question is whether the old Board was a corporation in the legal sense of that word. What is a Corporation? Corporations may be divided into two main classes, namely, corporations aggregate and corporations sole. We are not concerned in the present case with Corporation sole. A corporation aggregate has been defined as a collection of individuals united into one body under a special denomination, having perpetual succession under an artificial form, and vested by the policy of the law with the capacity of acting in several respects as an individual, particularly of taking and granting property, of contracting obligations and of suing and being sued, of enjoying privileges and immunities in common, and of exercising a variety of political rights, more or less extensive, according to the design of its institution, or the powers conferred upon it, either at the time of its creation or at any subsequent 167 period of its existence". (Halsbury 's Laws of England, 3rd Edn. Vol. 9, page 4.) A corporation aggregate has therefore only one capacity, namely, its corporate capacity. A corporation aggregate may be a trading corporation ora non trading corporation. The usual examples of a trading corporation are (1) charter companies, (2) companies incorporated by special acts of parliament, (3) companies registered under the Companies Act, etc. Non trading corporations are illustrated by (1) municipal corporations, (2) district boards, (3) benevolent institutions, (4) universities etc. An essential element in the legal conception of a corporation is that its identity is continuous, that is, that the original member or members and his or their successors are once In law the individual corporators, or members, of which it is composed are something wholly different from the corporation itself; for a corporation is a legal persona just as much as an individual. Thus, it has been held that a name is essential to a corporation; that a corporation aggregate can, as a general rule, only act or express its will by deed under its common seal; that at the present day in England a corporation is created by one or other of two methods, namely, by Royal charter of incorporation from the Crown or by the authority of Parliament that is to say, by or by virtue of statute. There is authority of long standing for saying that the essence of a corporation consists in (1) lawful authority of incorporation, (2) the persons to be incorporated, (3) a name by which tho persons are incorporated, (4) a place, and (5) words sufficient in law to show incorporation. No particular words are necessary for the creation of a corporation; any expression showing an intention to incorporate will be sufficient. The learned Advocate for the petitioners has referred us to various provisions of the and has contended that the 168 result of these provisions was to make the Board a corporation on registration. It is necessary now to read some of the provisions of that Act. The Act is entitled an Act for the registration of literary, scientific and charitable societies and the preamble states that it was enacted for improving the legal condition of societies established for the promotion of literature, science, or the fine arts, or for the diffusion of useful knowledge etc. , or for charitable purposes. Section 1 of the Act states that any seven or more persons associated for any literary, scientific, or charitable purpose, or for any such purpose as is described in s.20 of the Act may, by subscribing their names to a memorandum of association and filing the same with the Registrar of Joint stock Companies form themselves into a society under the Act. Section 2 lays down that the memorandum of association shall contain and one of the particulars it must contain is "the objects of the society". Section 3 deals with registration and the fees payable therefor. Sections 5 and 6 are important for our purpose and should be read in full. The property, movable and immovable, belonging to a society registered under this Act, if not vested in trustees, shall be deemed to be vested, for the time being, in the governing body of such society, and in all proceedings, civil and criminal, may be described as the property of the governing body of such society by their proper title. Every society registered under this Act may sue or be sued in the name of the president, chairman, or principal secretary, or trustee, as shall be determined by the rules and regulations of the society, and, in default of such determination, in the name of Such person as shall be appointed by the governing body for the occasion: 169 Provided that it shall be competent for any person having a claim or demand against the society, to sue the president or chairman, or principal secretary of the trustees thereof, if on an application to the governing body some other officer or person be not nominated to be the defendant. " Section 7 provides for non abatement of suits or proceedings and the continuance of such suite or proceedings in the name of or against the successor of the person by or against whom the suit was brought. Section 8 says that if a judgment is recovered against a person or officer named on behalf of the society such judgment shall not be put in force against the property, movable or immovable, or against the body of such person or officer, but against the property of the society. Section 10 provides that in certain circumstances mentioned therein a member of the society may be sued by the society; but if the defendant shall be successful in any such suit brought at the instance of the society and shall be adjudged to recover his costs, he may elect to proceed to recover the same from the officer in whose name the suit was brought, or from the society. Sections 13 and 14 provide for dissolution of societies and the consequences of such dissolution. These provisions have also an important bearing on the questions before us and are quoted in full. Any number not less than three fifths of the members of any society may determine that it shall be dissolved, and thereupon it shall be dissolved forthwith, or at the time then agreed upon, and all necessary steps shall be taken for the disposal and settlement of the property of the society, its claims and liabilities, according to the rules o the said society applicable thereto, if any, and, if not then as the governing body shall find expedient, provided that, in the event of any 170 dispute arising among tho said governing body or the members of the society, the adjustment of its affairs shall be referred to the principal court of original civil jurisdiction of the district in which the chief building of the society is situate, and the Court shall make such order in the matter as it shall deem requisite: Provided that no society shall be dissolved unless three fifths of the members shall have expressed a wish for such dissolution by their votes delivered in person, or by proxy, at a general meeting convened for the purpose: Provided that whenever any Government is a member of, or a contributor to, or otherwise interested in any society registered under this Act, such society shall not be dissolved, without the consent of the Government of the state of registration. If upon the dissolution of any society registered under this Act there shall remain, after the satisfaction of all its debts and liabilities, any property whatsoever, the same shall not be paid to or distributed among the members of the said society or any of them, but shall be given to some other society, to be determined by the votes of not less than three fifths of the members present personally or by proxy at the time of the dissolution, or, in default thereof, by such Court as aforesaid: Provided, however, that this clause Shall not apply to any society which shall have been founded or established by the contributions of shareholders in the nature of a Joint Stock Company. " Now, the question before us is regard being had to the aforesaid provisions was the Board a corporation? Our conclusion is that it was not. The most important point to be noticed in this connection is that in the various provisions of the 171 , there are no sufficient words to indicate an intention to incorporate, on the contrary, the Provisions show that there all absence of such intention. Section 2 no doubt provides for a name as also for the objects of the society. Section 5, however states that the property belonging to the society, if not vested in trustees, shall be deemed to be vested in the governing body of the society and in all proceedings, civil and criminal, the property will be described as the property of the governing body. The section talks of property belonging to the society; but the property is vested in the trustees or in the governing body for the time being. The expression property belonging to the society" does not give the society a corporate status in the matter of holding or acquiring property, it merely describes the property which vests in the trustees or governing body for the time being. Section 6 gives the society the right to sue or be sued in the Name of the president, chairman etc. and 8. 7 provides that no suit or proceeding in a civil court shall abate by reason of the death etc of the person by or against whom the suit has been brought. Section 8 again says that any judgment obtained in a suit brought by or against the society shall be enforced against it. It has been submitted before that 88. 6, 7 and 8 clothe the society with a legal personality and a perpetual succession; and section 10 enables the members of the society to be sued as strangers certain circumstances, by the society, and the Costs awarded to the defendant in such a suit may be recovered, at his election, from the officer in whose name the suit was brought. Dealing with very similar provisions (sections 7. 8 and) of the English Trade Union Act, 1871 (34 and 35 Vict, . 31) Lord Lindley said in the celebrated case of Taff Vale Railway vs Amalgamated Society of Railway Servants (1). (1) ; 172 The Act does not in express terms say what use is to be made of the name under which the trade union is registered and by which it is known. But a trade union which is registered under the Act must have a name . It may acquire property, but, not being incorporated, recourse is had to the old well known machinery of trustees for acquiring and holding such property, and for suing and being sued in respect of it (ss.7, 8,9). The property so held is, however, the property of the union; the union is the beneficial owner. The Act appears to me to indicate with sufficient clearness that the registered name is one which may be used to denote the union as an unincorporated society in legal proceedings as well as for business and other purposes." In Trade Union Law ' by N. A. Citrine (1950 edn.) to which the learned Advocate for the petitioners has referred, it is stated at p. 143: The object of this section (section 9) was to provide a method of enabling legal proceedings to be brought in respect of the property of a registered trade union. Since the legislature had no intention of giving such unions corporate status with power to hold property and to sue and be sued in their registered names, it was necessary to provide for the vesting of their property in trustees and to permit them to bring or defend legal proceedings in respect of that property on the unions behalf. section 8 of this Act, having provided for the vesting of the union 's property in its trustees, the present section supplements that section by empowering the trustees to bring or defend, on the union 's behalf, civil or criminal proceedings concerning its property." In Bonsor vs Musicians ' Union(1) the position (1) (L. R.) 173 Of a registered trade union in England came under consideration of the House of Lords in an appeal from the Court of Appeal. On a review of earlier decision including the decision in Tuff Vale Railway vs Amalgamated Society of Railway Servants(1), Lord Macdermott, Lord Keith of Avenholm and Lord Somervell of Harrow held that a registered trade union was not juristic person distinguishable at any at any moment of time from the members of which it was composed. After referring to the various provisions of the Trade Union Act 1871 and some of the earlier decision bearing on the question Lord MacDermott said: ' "I base this opinion primarily on the statutes. The more closely they are examined the clearer it seems to be that the legislature, though minded to bestow upon registered unions some of the gifts and attributes of legal personality, had no intention of doing more and was, indeed, adverse to the idea of going the whole length and making those unions new creatures, distinct in law from their membership, and fundamentally different from the combination of persons which the definition requires all trade unions to be." Lord Morton of Henryton and Lord Porter, who expressed the minority view, held that a registered trade union though not an incorporated body, was yet capable of entering into contracts and of being sued as a legal entity, distinct from its individual members. It is clear from the aforesaid decisions that provisions similar to the previsions of sections 5, 6, 7 and 8 of the were held not to show any intention to incorporate; on the contrary, the very resort to the machinery of trustees or the governing body for the time being acquiring and holding the property showed that there was no intention to incorporate the society or (1) ; 174 union of as to give it a corporate capacity for the purpose of holding and acquiring property. It , appears to us that the legal position is exactly the same with regard to the provisions in sections 6, 6, 7 and 8 of the . They do J not show any intention to incorporate, though they confer certain privileges on a registered society, which would be wholly unnecessary if the registered society were a corporation. Sections 13 and 14 do not carry the matter any further in favour of the petitioners. Section 13 provides for dissolution of societies and adjustment of their affairs. It says in effect that on dissolution of a society necessary steps shall be taken for the disposal and settlement of the property of the society, its claims and liabilities, according to the rules of the society; if there be no rules, then as the governing body shall find it expedient provided that in the event of any dispute arising among the said governing body or the members of the said society, the adjustment of the affairs shall be referred to the Court. Here again the governing body is given a legal power somewhat distinct from that of the society itself; because under s.16 the governing body shall be the governors, council, directors, committee, trustees or other body to whom by the rules and regulations of the society the management of its affairs is entrusted. We have, therefore, come to the conclusion that the provisions aforesaid do not establish the main essential characteristic of a corporation aggregate, namely, that of an intention to incorporate the society. We may further observe that the scheme and provisions of the Societies Registration Act,1860 are very similar to those of the Friendly Societies Act, 1986 (59 and 69 Vict. 0.25), as amended in certain respects by subsequent enactments. It is appropriate to quote here what Dennis Lloyd has said in his 'Law relating to Unincorporated Association ' (1938 edn.) at page 59 in respect of the 175 provisions of the Friendly Societies Act, 1896 as modified by subsequent enactments. He has said: The modern legislation still maintains the policy of the older Acts in withholding corporate status from friendly societies. Registration does not result in incorporation, but merely entitles the society so registered to enjoy the privileges conferred by the Act. These privileges are of considerable importance and certain of them go a long way toward giving registered societies. a status in many respects analogous to a corporation strictly so called, but without being technically incorporated. Thus something in the nature of perpetual succession is conceded by the provision that the society 's property is to vest in the trustees for the time being of the society for the use and benefit of the societies and its members and of all persons claiming through the members according to the society 's rules, and further (and this is the most noteworthy provision) that the property shall pass to succeeding trustees without assignment or transfer. In the same way, though the society, being unincorporated, is unable to sue and be sued in its own name, it is given the statutory privilege of suing and being sued in the name of its trustees. " We think that these observations made with regard to similar provisions of the Friendly Societies Act, correctly and succinctly summarise the legal position in respect of the several provisions of the . Those provisions undoubtedly give certain privileges to a society registered under that Act and the privileges are of considerable importance and some of those privileges are analogous to the privileges enjoyed by a corporation, but there is really no incorporation in the sense in which that word is legally understood. 176 On behalf of the petitioners reliance has been placed on the decision in Krishnan vs Sundaram (1) where Kania, J., (as he then was) said: The position of a society registered under the is like that of a club or a joint stock company. " There was no discussion of the question of incorporation, and the decision cannot be accepted as authoritatively laying down that a society registered under the Societies Registration, Act is a corporation. There was a similar observation without any discussion in Boppana Rukminamma vs Maganti Venkata Ramadas(2) and N. A. Nannier vs Official Assignee, Madras (3). There is how ever, a fairly full discussion of the question in Satyavart Sidhantalankar vs The Arya Samaj, Bombay (4) where Bhagwati, J., held that a Society registered under the was a legal entity apart from the members constituting it, and it can sue and be sued in its own name. The question which fell for decision in that case was not whether a society registered under the was 'incorporated ' as that term is legally understood. The question there was whether such a society could sue or be sued accept in the manner provided by 6 and 7. It was held that it could and the reason given was thus expressed by the learned Judge: " I am of opinion that the provisions contained in sections 6, 7 and 8 of the are not inconsistent with the user of the registered name of the society in connection with legal proceedings. As Lord Lindley observed in Taffy Vale Railway Company`s case (supra), "I do not say that the use of the name is compulsory but it is at least permissive. " If this is the true legal position of a society registered under the Societies Registration (1) (140)43 Bom L.R. 56 (2) A.I.R. 1940 Mad. (3) A. I. R.1951 Mad.875. (4) 177 Act, the objection . that the plaintiffs and the defendants are one and the same and that the suit as framed is not maintainable by reason of the society being the plaintiffs as well as the defendants disappears. The plaintiffs are suing on behalf of themselves and all the members of the society. The First defendant is the president of the society and represents the society. As I have already observed the society on its registration with the Registrar of Joint Stock Companies becomes a legal entity apart from its members; it would be therefore idle to contend that the society arc the plaintiffs as well as the first defendant in this action ' It is unnecessary for use to consider the correctness or otherwise of the reason given; it is sufficient for use to state that we do not think that the decision proceeds on the footing that a society registered under the is a corporation in the sense of being incorporated as that term is legally understood, but if it does, we are unable to accept it as correct. " The precise question which has arisen before US arose in Servants of India Society, Poona vs The Charity Commissioner of Bombay ). The facts of that case were these. The "Servants of India Society" was an institution which was registered under the . It owned considerable movable and immovable property both in the State of Bombay as well as in other parts of India. The State of Bombay issued a notification under a 1(4) of the Bombay Public Trusts Act, 1950 (Bom. Act XXIX of 1950) which applied the provisions of that Act to a society formed for religious or charitable purposes and registered under the . An application was made under 8.18(1) of the Bombay Public trusts Act 1950 for registration of the Servants of India Society. During an enquiry into (1) ; 178 that application an objection was taken that the Servants of India Society having been registered under the was a corporation and had objects also outside the Bombay State and therefore, a legislation purporting to regulate the activities of such a society fell in entry 44 of List I and consequently the State Legislature had no power to make any law to regulate the affairs of such a society. This objection was dealt with first by the Assistant Charity Commissioner and then the Charity Commissioner; thereafter, an application Was made under 8. 72 of the Bombay Public Trusts Act, 1950 to the Court of the District Judge, Poona. Then the matter was taken to the High Court on appeal from the decision of the District Judge. The appeal came up for hearing before our learned brother Mudholkar, J. (who was then a Judge of the Bombay High Court) and Patel, J. After referring to several decision including the decision of Bhagwati, J. in Satyavart Sidhantalankar vs The Arya Samaj, Bombay (1) our learned brother held that the Servant of India Society registered under the was a legal entity and a quasi corporation. He further held that entry 44 in List I and the first part of entry 32 in List II relating to incorporation, regulation and winding up of corporations ' must be given a liberal construction and quasi corporations would come under those entries. Basing himself on a parity of reasoning relating to entry 7 in List III which related to 'Contracts ', he said that if quasi. contracts would come under entry 7, quasi corporation must also come under entries 43 and 44 of List I and the first part of entry 32 of List II. mr. Justice Patel took a different view. He said: A reference to entry 32 of the State List shows that, incorporation regulation and winding up of corporation, other than those specified in List I (Union List, entries 43 regulation and (1) 179 44), and universities are expected from Union List. Further "unincorporated trading, literary, Scientific, religious and other Societies and associations" and "co operative societies" are also excepted from the Union List. The emphasis would appear to be on the word unincorporated ' used in connection with "trading, literary, scientific, religious and other societies and associations". If an association or society is unincorporated, then it may not fall within the Union List. The question, therefore, that is pertinent to be decided is not whether or not an association or a society is a legal entity or a quasi corporation, but whether it is incorporated or unincorporated. If this is borne in mind, then it is amply clear that entries 43 and 44 of the Union List would cover only those societies and associations which are incorporated; and those which may have legal entity but which are not incorporated will not fall within the Union List. " The matter was then referred to a third Judge (Gokhale, J.) who thus expressed his view: In my judgment, societies registered under the societies Registration Act are neither corporations nor quasi corporations, but are unincorporated societies contemplated under the second part of entry 32 of the State List." Mr. Justice Gokhale also expressed the view that when Considering the ambit of an express legislative power in relation to an unspecified residuary power, abroad interpretation must be given to the former; the case, however, is different where under the Constitution there are two complementary powers each expressed in precise and definite terms and in such a case there is no justification for giving a broader interpretation one power rather than to the other. We find ourselves in agreement with 180 this view. It seems clear to use that entries 43 and 44 of list I when they talk of incorporation, regulation and winding up of corporations relate to such legal entities as have been incorporated and are corporations in the full sense of the term. Similarly,the first part of entry 32 of List II when it talks of "incorporation, regulation and winding up of corporation '` relates to such legal entities as are incorporated. This is further clarified by the second part of entry 32 which talks of "unincorporated trading. literary, scientific, religious and other societies and association". In entry 32 there is a dichotomy in the two parts thereof: the first part relates to incorporated societies which are corporations in the true sense of that term, and the second part relates to unincorporated societies. The justification is between incorporated societies and unincorporated societies and there can be no doubt as to which of the two parts in which a society registered under the will fall, be it called a quasi corporation or by any other name. A society registered under the may have characteristics which are analogies to some of the characteristics of a corporation; yet it is not incorporated and remains an unincorporated society. AS soon as it is held that it is an unincorporated society, it must come under the second Part of entry 32 of List II. In this view of the matter it is unnecessary to decide the further questions as to (1) whether the objects of the old Board extended beyond the State of Delhi, and (2) if other entries such as entry 11 of List II and entry 28 of List III can support the impugned legislation. We may, however, observe that if we had come to a different conclusion on the question whether the old Board was a corporation or not and it became necessary to decide question No. (1) above, we might have held that in view of the rules governing the old Board, its objects were not confined to the State of Delhi only in the sense 181 that it would not have been ultra vires of the old Board to have started colleges etc., outside the State of Delhi. We should however, add that the activities of the old Board did not, as a matter of fact, extend beyond the State of Delhi on the (late when the impugned Act was enacted. There is another aspect of the question which has to be considered here. Section 3 of the impugned Act is in these terms: 3. (1) With effect from such date as the Chief Commissioner may, by notification in the official Gazette, appoint (hereinafter referred to in this Act as "the appointed day"), the entire management and control of the Ayurvedic and Unani Tibbi College, Delhi now vested in the Board of Trustee of the Ayurvedic and Unani Tibbi College, Delhi, shall be vested in a Board to be called the Tibbia College Board". (2) The Board shall be a body corporate having perpetual succession and a common seal and shall by the said name sue and be sued. " Sub section (2) of 8. 3 says in express terms that the new Board constituted under the impugned Act is given a corporate status; in other words, the new Board is a corporation in the full sense of the term Does the impugned legislation still come within entry 32 of List II . We think it does and for these reasons. We have held that the old Board was not a corporation, even though it was registered under the . When, therefore, the Delhi State Legislature passed a law dissolving the old Board, it was really dealing with an unincorporated society or association By the impugned legislation, however, it gave the new Board a corporate status, but at the same time so delimited the powers and duties of the new Board as to confine them to the State of Delhi 182 only. The impugned Act is entitled an Act to provide for transfer of the management of the Ayurvedic and Unani Tibbi College, Delhi, founded by the late Hakim Ajmal Khan from its present trustees to a Board. " In other words, the Act deals only with the college in Delhi and the pharmaceutical institute attached to it. Section 7 which gives the powers and duties of the new Board is in these terms: 7. The Board shall exercise the following powers and perform the following duties, namely: (a) to maintain the Ayurvedic and Unani Tibbi College, Delhi with a view to impart higher eduction to men and women in the Ayurvedic and Unani Systems of Medicine and to promote and conduct research in the same: (b) to maintain and improve the Hindustani Dawa Khana and Rasayanashala; (c) to provide for studies to enable incorporation, where necessary of the principle of the modern system of Medicine and surgery in order to help the scheme of studies for the Ayurvedic and Unani systems according to the exigencies of time; (d) to help produce and publish books in order to facilitate the carrying out of the objects specified in the clauses (a) to (c); (e) to receive gifts, donations or benefactions from Government and to receive bequests, donations and transfer of movable or immovable properties from trustees, donors or transferors, as the case may be; (f) to deal with any property belonging to or vested in the Board in such manner as the Board may deem fit for advancing the objects specified in clauses (a) to (d); 183 (g) to do all such things as may be necessary incidental or conductive to the attainment of all or any of the subjects specified in clauses (a) to (d) Unlike the rules governing the old Board which enabled it to establish colleges outside Delhi for the purpose of imparting higher education ill the Unani and Ayurvedic systems of medicine, section 7 gives the new Board powers and duties with regard to the Ayurvedic and Unani Tibbi College at Delhi and the pharmaceutical institute and laboratory attached to it. This is made further clear by the definition of the word Board ' in 8. 2, incorporation section, namely, 8. 3, constitution of the Board as laid down in 8. 4, and the sections relating to the power of the chief commissioner to supersede the Board, to make rules to carry out the objects of the Act and the power of the Board to make regulations not inconsistent with the Act for carrying out the purposes thereof. None of the provisions of the impugned legislation accepting 8. 9 to which we shall presently refer give the new Board any powers or duties other than those connected with the college, attached pharmaceutical institute and laboratory, all situate in the State of Delhi. We now come to 8. 9 which is in these terms: "9.(1) As from the appointed day, the Board of Trustees of the Ayurvedic and Unani Tibbi College, Delhi, a society registered under the provisions of the Registration of Societies Act, 1860, on the 12th day of August, 1911, by the name Anjuman i Tibbia whose purpose, Constitution and name was amended on 25th November, 1915), shall stand dissolved and all property, movable and immovable, and all rights, powers and privileges of the said society which immediately before the appointed day belonged to or were vested in the said society shall vest in the 184 Board and shall be applied for the purposes for which the Board is constituted. (2) As from the appointed day all debts and liabilities of the said society shall stand transferred and attached to the Board and thereafter be discharged and satisfied by the Board. (3)Any will deed or other document whether made or executed before or after the commencement of this Act, which contains any bequests gifts, or trust in favour of the society shall as from the appointed day, be construed as if the Board were therein named instead of the Society. " It no doubt says that all rights, powers and privileges which immediately before the appointed day belonged to or were vested in the old Board shall vest in the new Board; but it adds that those rights, powers and privileges shall be applicable for the purposes for which the new Board is constituted. We must, therefore, read B. 9 as being subject to the provisions of 7 of the Act. In terms 9 says that the rights, powers and privileges of the old Board shall be available to the new Board and shall be applied for the purposes for which the new Board is constituted . The words underlined are important, and show clearly enough that the right, powers and privileges of tho old board are available to the new for a limited purpose only, namely, for the purposes for which the new Board is constituted. If the purposes for which the now Board is constituted are confined to the institutions in Delhi, then obviously the objects for which the new Board is incorporated do not extend beyond the State of Delhi. The conclusions at which we have arrived may now be summarised as follows: (1) On registration under tho , the old Board did not 185 become a corporation is the sense of being incorporated within the meaning entry 44 of List I; it remained and hoodwinked to be an unincorporated society though under the several provisions of the it had certain privileges, some of the privileges being analogous to those of corporation; (2) the impugned legislation while creating the new Board has given it a corporate statue, but has confined its powers and duties to the college, pharmaceutical institute and laboratory in Delhi and while giving the new Board rights, powers and privileges of the old Board has limited them to such purposes for which the new Board is constituted; (3) the impugned legislation therefore, falls under entry 32 of List II; so far as the dissolution of the old Board is concerned, under the second part of the entry and so far as incorporation of the new Board is concerned, under its first part. That being the position, the impugned legislation was well within the legislative competence and power of the Delhi State Legislature. We must, therefore, overrule the first ground of attack urged on behalf of the petitioners. We now proceed to a consideration of the second ground of attack. So far as the alleged violation of article 14 is concerned, The petitioners have stated in their petition: "There are various other institutions where there have been actual allegations of mismanagement but the State has picked out the petitioner. Assuming, without admitting, that there has been mismanagement by the petitioner of its affairs, there is not the slightest suggestion in the whole Act that it is promulgated on the ground of any mismanagement on the part of the petitioner. The said Act is an arbitrary piece of legislation and There is no reasonable 186 Classification whatsoever on which it can be supported. " To this the reply of the respondents is that the old Board was grossly mismanaging its affairs they said. "Before the said Act was passed, there was a great deal of discontent among the students of the said institution and also the general public and there was strong agitation against cross mismanagement by the trustees of the said Board. That owing to the gross mismanagement of the Board 's affairs by the trustees the situation had so deteriorated that early in 1949 there were constant students ' strikes, defalcation of funds and frequent interruption in work and studies of the institution. " In our view the petitioners have not made out any basis for the contention that (1) there were other institutions similarly situated, and (2) petitioner No. 1 was picked out for unequal treatment. The names of no other institutions similarly situated have been disclosed. In the first Sholapur case Chiranjit Lal Chowdhuri, vs The Union of India (1) it was held by a majority of Judges of this court that even one corporation, (in our case one society) or a group of persons can be taken as a class by itself for the purpose of legislation, provided it exhibits some exceptional features which are not possessed by others. The courts should prima facie lean in favour . Of constitutionality and should support the legislation if it is possible to do so on any reasonable ground, and it is for the party who attacks the validity of the legislation to place all materials before the court which would go to show that the selection is arbitrary and unsupportable. Throwing out of vague hints that there may be other (1) ; , 915, 914. 187 Instances of similar nature is not enough for this purpose". (per Mukherjea, J. at pp. 913 914 of the report. These observations apply with equal force to the present case and we are unable to sustain the contention of the petitioners that any right under article 14 of the Constitution has been violated. As to article 31 of the Constitution it seems clear to us that cl. (2) of the said Article as it stood at the relevant time has no application. The impugned legislation does not relate to nor does it provide for, compulsory acquisition of property for a public purpose. The impugned legislation provided for the transfer of the management of the Ayurvedic and Unani Tibbi College, Delhi, from the old Board to a new Board and for that purpose the old Board was dissolved and a new Board was created with certain rights, powers and privileges to be applied for the exercise of powers and performance of duties as laid down in 8. 7 of the Act. Such legislation does not fall under article 31(2) and cannot be judged by the tests laid down there in. As to cl. (1) of article 31 there is no question of any violation of that clause if the law by which the transference of management has been made is valid law. We have already held that the impugned legislation was well within the legislative competence of the Delhi State Legislature. Now the question is the impugned legislation bad on the ground that it violates the right of the petitioners under article 19(l)(f)? The property for the protection of which article 19(l)(f) is invoked belonged either to the Board or to the members composing the Board at the date of the dissolution. In either event, on the terms of 8. 5 of the Societies Registration Act, 1960, the property was to be deemed to be vested in the governing body of the Board. There could be no doubt that if the Board was dissolved by 188 competent legislative action, and in view of our conclusions on the first point raised it must be held that this had taken place the Board would cease to exist and having ceased to exist cannot obviously lay any claim to the property. This however may not be sufficient to negative the contention urged before us by the petitioners. If the legal ownership of the property by the Board or the vesting of it in the governing body was merely a method or mechanism permitted by the law whereby the members exercised their rights quoad the property, the dissolution of the Board and with it of the governing body thereof would merely result in the emergence of the right of the members to that property. It is, therefore, necessary to ascertain the precise rights the members of the Board possessed to see whether the changes effected by the impugned Act amount to on infringement of their rights within the meaning of article 19(l)(f). During the subsistence of the society, the right of the members was to ensure that the property was utilised for the charitable objects set out in the memorandum and these did not include any beneficial enjoyment Nor did the members of the Society acquire any beneficial interest on the dissolution of the society; for 8. 14 of the Act, quoted earlier, expressly negatived the right of the members to any distribution of the assets of the dissolved body. In such an event the property had to be given over to some other society, i.e., for being managed by some other charitable organisation and to be utilised for like purposes, and the only right of the members was to determine the society to whom the funds or property might be transferred and this had to be done by not less than three fifths of the members present at the meeting for the purpose and, in default of such determination, by the civil court. The effect of the impugned legislation is to vary or affect this privilege of the members and to vest the property in a new body created by it enjoined to administer it so to serve the same purposes as the dissolved 189 Society. The only question is whether the right to determine the body which shall administer the funds or property of the dissolved society which they had under the pre existing law is a right to 'acquire, hold and dispose of property ' within the meaning of article 19(l)(f), and if so whether the legislation is not saved by article 19(5). We are clearly of the opinion that right is not a right of property within the meaning of article 19(l)(f). In the context in which the words 'to dispose of ' occur in article 19(l)(f), they denote that kind of property which a citizen has a right to hold the right to dispose of being part of or being incidental to the right to hold Where however the citizen has no right to hold the property, for on the terms of 8. 14 of the Societies Registration Act the members have no right to hold ' the property of the dissolved society, there is, in our opinion, no infringement of any right to property within the meaning of article 19(l)(f). In this view, the question as to whether the impugned enactment satisfies the requirements of article 19(5) does not fall to be determined. The two decisions on which the learned Advocate. for the petitionary has relied are the State of West Bengal vs Subodh Gopal Bose (1) and Dwarkadas Srinivas vs The Sholapur Spinning, & Weaving Co. Ltd.(2). We do not think that these decisions have any application in the present case. In the State of West Bengal vs Subodh Gopal Bose(1) this Court was considering a piece of legislation which affected the right of the first respondent therein who had purchased a particular touzi at a revenue sale. As such purchaser he acquired under 8. 37 of the Bengal Revenue Sales Act, 1859, the right to avoid and annul all under tenures and forthwith to eject all under tenant" with certain exceptions. In exercise of that right the respondent gave notices of . ejectment and brought a suit in 1946 to evict certain tenants. The suit was decreed. When the appeal (1) ; (2) [1954] section C. R. 674. 190 was pending, a new legislation was made which took away the right of the first respondent which he had obtained by a decree of a court of law. In these circumstances it was held that the right of the first respondent under article 19(l)(f) was violated. The facts of that case were wholly dissimilar and the respondent`s right there did not depend on his being a member of a society. In the second Sholapur case Dwarkadas Srinivas vs The Sholapur Spinning & Weaving Co. Ltd .(1) a Controller was appointed by Government to supervise the affairs of the mills of a certain company under the Essential Supplies Emergency Powers Act, 1946. The controller made certain requisitions which the Directors refused to comply with. The Governor General then made an ordinance which was followed by an Act. Under the provisions of the ordinance the Central Government delegated all its powers to the Government of Bombay. The Government of Bombay then appointed certain Directors to take over the assets and management of the mills. These new Directors passed a resolution making a call of Rs. 50/ on each of the preference Shares payable at the time stated in the resolution. The appellant in that case was a preference shareholder who was called upon to pay Rs. 1,62,000/ in pursuance of the resolution aforesaid on the preference shares where which he held. The appellant then brought a suit challenging the validity of the ordinance and out of that suit appeal to this Court arose. It was held by this Court that the impugned ordinance and the act replacing it authorised in effect a deprivation of the property of the company within the meaning of article 31 without compensation and violated the fundamental right of the appellant therein as a preference shareholder, who was called upon to pay the moneys unpaid on his shares. The point to be noticed as distinguishing that case from the case under our consideration is this (1) ; 191 the Sholapur Spinning and Weaving Co. Ltd, which was the company in that case, had not been dissolved or brought to an end by the impugned ordinance or the Act replacing it and the appellant in that case continued to be a preference shareholder; not only did he continue to be a preference share holder but he was called upon to pay the moneys unpaid on his shares. It is obvious, therefore, that the appellant was entitled to complain that by the impugned ordinance he was being deprived of his property without fulfilling the requirements of article 31 of the Constitution. The position in the case under our consideration is, as pointed out already, entirely different. In our view the impugned legislation does not violate any fundamental right of the petitioners under articles 14, 19 or 31 of the Constitution. This disposes of the two main grounds on which the legislation in question has been impugned. We now turn to the two subsidiary points. It has been argued that some of the provisions of the impugned Act are in conflict with the provisions of the ; therefore under section 22 to the Government of part a States Act, 1951 the provisions of the impugned Act, in so far as they are repugnant to the provisions of the , must be held to be void. The simple answer to this argument is that 8. 22, to which we had earlier referred in the course of this judgment, has no application Section 22 provides for inconsistency between laws made by Parliament (in the sense in which the word Parliament ' is used in the Constitution of India) and laws made by the Legislative assembly of a Part State. The was not a law made by Parliament; therefore a 22 has no application in the present case. We have already held, for reasons earlier given, that the Delhi State Legislature had legislative competence or power either to amend the 192 in respect of unincorporated societies, or to make a law for a particular unincorporated society, and even to create a new corporate body provided its objects were confined to the State of Delhi of Delhi. In effect the impugned legislation provides for a disolution of the old Board which was an unincorporated society and for the creation of a new corporate body for the management of the Ayurvedic and Unani Tibbi College, Delhi. In this view of the matter, no question of any conflict with the arises in this case. It has also been argued that the impugned legislation is a piece of colourable legislation because the Delhi State Legislature acted mala fide in enacting it. This argument is completely answered by what this Court said in K. C. Gajapathi Narayan Deo vs The State of Orissa (1). This court said: It may be made clear at the outset that the dotrine of colourable legislation does not involve any question of bona fide or male 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 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 competence, the question motives does not arise at all If the constitution of a State distributes the legislative powers amongst different bodies, which have to act within their respective spheres marked out by specific legislative entries, or if there are limitations on the legislative authority in the shape of fundamental rights, questioned do aries to whether the legislature in a particular case has or has not in (1) S.C.R. 1, 10, 11. 193 respect to the subject matter of the status or in the method of enacting it, transgressed the limits of its constitutional powers. Such 7 transgression may be patent, manifest or direct, but it may also be disguised, covert and indirect and it is to this latter class of 7 cases that the expression "colourable legislation" has been applied in certain judicial pronouncements. The idea conveyed by the expression is that although apparently a legislature in passing a statute purported to act within the limits of its powers, yet in substance and in reality it transgressed these powers, the transgression being veiled by what appears, on proper examination, to be a mere pretence or disguise." From what we have said earlier it should be manifestly clear that the Delhi State Legislature did not transgress any of the limitations placed on it, when it enacted the impugned legislation. There being no transgress whatsoever, the further question of the transgression being veiled by a disguise or pretence does not really arise. Nor is it necessary for us to enquire into the motives which led the Delhi State Legislature to enact the impugned legislation. In the affidavits filed on behalf of the respondents enough materials have been placed to show why the Delhi State Legislature considered it necessary to dissolve the old Board and transfer the management of the college to a new Board. This was a matter for the Legislature to consider and not for this Court to investigate. In the result we hold that there is no merit in the petition which is accordingly dismissed with costs MUDHOLKAR, J. While I agree with my brother Das J., that the petition be dismissed I would like to say a few words. This petition under article 32 of the Constitution has been preferred by 194 the Board of Trustees, Ayurvedic and Unani Tibia College, through its Secretary, Hakim Mohammad Jamil Khan By Act 5 of 1952 called the Tibia College hi Act, 1952 the erstwhile Delhi State Legislative Assembly dissolved the Board of Trustees of the Ayurvedic and Unani Tibia (College, incorporated a Board called 'Tibia College Board ' and transferred to that Board all the property, rights, powers and privileges of the Board of Trustees of the Ayurvedic and Unani Tibia College also the management and control of the Ayurvedic and Unani Tibia College to the aforesaid Board. The reason for doing so would appear from the Statement of objects and Reasons appended to the Bill which are as follows: This Bill seeks to take powers for transferring the management of the Ayurvedic and Unani Tibia College, Delhi, from its present trustees to a Board under the control of the Delhi State Government. The College has been grossly mismanaged for some time past with the result that its reputation is very low today. In early 1949, the situation deteriorated to such an extent that there were students strikes, defalcation of funds and frequent interruptions in scholastic work. The Collector, Delhi made an interim prayer to the Civil Court for the appointment of receivers. This prayer was granted and three receivers appointed by the Civil Court are at present in charge of the properties and management of the institution. This arrangement, which is good so far as it goes, is inevitably temporary and inadequate, and it seems desirable to provide by legislation for the control and management of the College and the properties attached thereto." (Statement of objects and Reasons published in the Gazette of India, Extraordinary, Part II, section 2, July 18, 1952). The petitioner 's complaint is that its property has been taken may without compensation and 195 handed over to a Board in contravention of article 31 of the Constitution and that this has been done under a law which the Delhi legislature was not competent to make. The following four contentions were raised by Mr. Purshottam Trikamdas on behalf of the petitioner. (1) That the Delhi Legislative Assembly was not competent to pass the impugned Act. (2) Even assuming that it had legislative competence the Act offends articles 14, 19 and 31. (3) The under which the Board of Trustees were registered being a Central Act the Delhi legislative assembly had no power to over ride it. (4) The law was enacted by the legislature mala fide. I will confine my observations mainly to the first and third points because, it is only with regard to them that my view is somewhat different from that taken by my learned brother. The respondents point out that the petitioner Board having been registered under the is nothing more than an unincorporated society and that the Delhi State legislature was competent to enact a affecting it under the latter part of Entry 32 of List II which runs thus: ". . . unincorporated trading, literary, Scientific, religious and other societies. and assassination; co operative societies". According, however, to Mr. Purshottam, after the Board of Trustees was registered as a Society under the it blossomed into a corporation and since admittedly its objects extend beyond the limits of the Delhi State the State Assembly could not make any law affecting 196 it. This contention has been negatived by my learned brother. An alternative contention was also raised on behalf of the petitioner on the basis of certain decisions and my opinion in Servants of India Society, Poona vs The Charity Commissioner of Bombay (1) to the effect that upon registration J. the Board became at least a quasi corporation. This contention has also been negatived by my learned brother. If, as the petitioner says the Board, after registration under the was transformed into a corporation the Delhi Legislative assembly could not make a LAW with respect to it under Entry 32 because though under the first part thereof it can make a law affecting corporation, its powers cannot reach a corporation, the objects of which extend beyond the limit of the Delhi State. But as my learned brother has pointed out and with which I respectfully agree, the essence of a corporation is its incorporation ' and as the does not provide for incorporation the petitioner cannot be recorded as a corporation. It is true that even though it possesses some of the attributes of a corporation it ii not a corporation but in my view it is a near corporation ' or a quasi corporation '. This is what I have held in the Servants of India Society 's case (1) and I adhere to that view. There, relying on some Indian decision and the decision in The Taff Vale Railway Co. vs The Amalgamated Society of Railway Servants(2), I held that such a society is a legal entity and that a State legislature cannot make any law affecting it under the second part of Entry 32 of List II. The question whether a registered society which enjoyed more or less the same powers as those under the is a legal entity fell for consideration by the House of Lords in Bonsor vs Medicines ' Union(3) and there Lords Morton and Parker held that (1) ; 381 (2) ; (3) [1956] A.C.104 197 such a society is a legal entity though not a corporation and thus accepted the position that there is an intermediate semi corporation status. Lord Keith held that such a society is both a legal entity and association of individuals, that is, it is a quasi corporation to the extent recognized by the governing statute and a voluntary association for other purpose. Lords McDermott and Somervell, however, did not accept the position that there is any intermediate semi corporate status at all. With respect, I think that the view taken by the majority has much to commend itself. That this is the better view is the opinion of Prof. Dennis Lloyd (vide 1956 M. L. R. at p. 360) and of Dr. Glanville William (vide Salmond 's Jurisprudence, 1957 ed. p. 356). I have not come across a contrary opinion in any recent treatise or article. Now, under the , which was enacted by the Governor General in Council upon registration a society is entitled to sue and can be sued in the name of its President, Secretary etc., as shall be determined by its rules or by its governing body. A suit by or against the society would not abate by reason of the death of the person through whom or against whom the suit had been brought. A judgement obtained against a person sued as representing a society shall not be enforced against him but against the property of the society. The society can sue any of its members for arrear of subscription, damages etc. It can also enter into contracts as an entity. Upon dissolution, its property cannot be distributed amongst its members but must go to some other society. All these are the characteristics of a separate legal entity such as a corporation. If the law confers on a body all the normal powers of a legal person it will be a corporation in all but name. A registered society, however, cannot hold property and to that extent it must be treated a a voluntary 198 association, made up of its constituents. Therefore, it can be regarded as a quasi corporation or, in the words of Lords Morton and Porter, a near corporation". Now, a quasi corporation or a near corporation whatever we may call it being a legal entity at least for some purposes is not a mere society made up of its constituents. The question, therefore, must be considered whether the latter part of Entry 32 confers power on the State legislator to legislate about legal entities. ' Let US consider the scope of the latter part of Entry 32. It permits the making of laws concerning societies and associations which are not incorporated. This would imply that thereunder the legislature cannot provide for the incorporation ' of a society or association. One of the main results of incorporation is to confer upon the thing incorporated the status of a separate legal entity. Even so, under this Entry the legislator has a wide discretion in the matter of conferral of powers upon a society. But can it confer such powers on it as would alter its character as a society and convert it into a legal entity, may be only for certain purposes? By its very definition a society is a voluntary association and can have no existence separate from its constituents. It is thus not a separate legal entity ill any sense and for any purpose. That Entry makes it clear by using the word unincorporated ', that the power conferred by it is confined to such societies and associations only. Therefore, in my judgment the Entry does not permit of any law being made which confers on a society such powers as would constitute it into a legal entity. A fortiorari, it does not permit a law to be made which takes away from society already existing and which is a legal entity any of the powers of that legal entity, such as those conferred by the , much less can it destroy that entity For doing so it will have to take the aid of other entries, if any, which permit legislation concerning Legal entities . 199 The Board, as already stated, was registered under the . That was a law made by the Indian legislature under 24 & 25 Vict. 67 passed in the year 1860. That law conferred the power to make laws for the whole of British India on the Governor General in Council the ambit of whose power is set out in 8. 22 which runs thus: The Governor General in Council shall have Power at Meetings for the Purpose of making Laws and Regulations a aforesaid, and subject to the Provisions herein contained, to make Laws and Regulations for repealing, amending, or altering any Laws or Regulations whatever now in force or hereafter to be in force the Indian Territories now under the Dominion of Her Majesty, and to make Laws and Regulations for all Persons, Whether British or Native, Foreigners or others, and for all Courts of Justice whatever, and for all Places and Things whatever within the said Territories, and for all Servants of the Government of India within the dominions of Princes and States in Alliance with Her majesty; and the Laws and Regulations so to be made by the Governor general in Council shall control and supersede and Laws and Regulations in anywise repugnant thereto which shall have been made prior thereto by the Governors of the Presidencies of Fort Saint George and Bombay respectively in Council, or the Governor or Lieutenant Governor in Council of any Presidency or other territory for which a council may be appointed, with Power to make law and Regulations, under and by virtue of these Act: Provided always, that the said Governor General in Council shall not have the power of making any Laws or Regulations which shall repeal or in any way affect any of the Provisions of this Act. 200 Or any of the Provisions of the Acts of the Third and Fourth Years of King William the Fourth, Chapter Eighty five and the Sixteenth and Seventeenth Years of Her Majesty, Chapter Ninety five, and of the Seventeenth and Eighteenth Years of Her Majesty, Chapter Seventy Seven, which after the pacing of this Act shall remain in force: or any Provisions of the Act of the Twenty first and Twenty second Years of Her Majesty, Chapter one Hundred and Six entitled an Act for the better Government of India; or of the Act of the Twenty second and Twenty third years of Her Majesty, Chapter Forty one, to amend the same: or of any Act enabling the Secretary of State in Council to raise Money in the United Kingdom for the Government of India: or of the Acts for punishing Mutiny and Desertion in Her Majesty 's Army or in Her Majesty`s Indian Forces reflectively; but subject to the Provision contained in the Act of the Third and Fourth Years of King William the Fourth, Chapter Eighty five, Section Seventy three, respecting the Indian Articles of War: Or any Provisions of any Act passed in this present session of Parliament, or here after to be passed, in anywise affecting Her Majesty`s Indian Territories, or the Inhabitants thereof: Or which may affect the Authority of Parliament, or the Constitution and rights of the East India Company, or any Part of the unwritten Laws or constitution of the United Kingdom of Great Britain and Ireland, where on may depend in any Degree the Allegiance of any Person to the Crown of the United Kingdom, or the Sovereignty or Dominion of the Crown over any Part of the said Territories " 201 This clearly shows that the Governor General in Council was unhampered in the matter of making laws by any legislative lists and thus enjoyed plenary powers to make any kind of law on every conceivable topic which did not fall within the excepted Categories. Within the sphere of his powers the Governor General in Council was and could consequently make a law conferring upon a society such powers as could transform it into legal entity either for all purposes or only some. If he chose to confer all the powers of a corporation upon a registered society, that society would become a corporation in all but a name. The position of the State Legislature in the matter of making laws is not the same as that of the Governor General in Council under the statute of 1860. For, though it enjoys no less plenary powers than the Governor General in Council, its spheres of legislation are restricted by the legislative lists and it cannot overstep them by doing something directly which is patently outside Lists The only entry in List II on which reliance was placed on behalf of the respondents as conferring power on the Delhi legislature to make the impugned law is the latter part of Entry 32, List II. That entry speak of societies, that is, of associations of individuals as distinct from a legal entity, from that which has a separate legal existence. An association has no such separate existence, that is, none apart from its members. That entry therefore, could not furnish the Delhi legislature with the power to make a law affecting a separate legal entity such as the petitioner. Section of the impugned Act dissolved the petitioner, a legal entity and transfers its property, rights etc., to a corporation created by it. Thus it deals with a legal entity and the rights of that entity. This is wholly outside the ambit of the latter part of Entry 32. It would have been 202 possible for the State legislature to resort to the first part of that Entry had the object of the society been limited to the Delhi state but, as already ' ' stated, the objects extent beyond the Delhi State. The reason why I think it would have been possible is that the entry is not restricted to incorporation of a corporation but deals also with the regulation or winding up of a corporation which would include a quasi corporation or any other fictitious legal person, and further because the essence of winding up can be no different from that of dissolution. No doubt, ours is a federal constitution and the legislative fields of Parliament and of the state legislatures are demarcated, In addition we have a concurrent field in which Parliaments legislative power is exercisable and, subject to certain conditions, also that of the state legislatures. But even so, there is a certain amount of overlapping in the entries in the three lists pertaining to these three legislative fields. Therefore when a law is challenged on the ground of legislative competence what one has to ascertain is its pith and substance. It is well settled that if in pith and substance it is found that the legislature could make that law under a particular entry, the mere fact that it incidentally trenches upou some other entry, not pertaining to the legislation, it cannot be struck down as being beyond the competence of the legislature which made it. For finding out its pith and substance, let us examine the Act. It is comprised of 16 sections. Section 3 deals with the incorporation of the Tibia college Board and transferring to it the management and control of the Tibia College vested in the petitioner board. Section 9 deals with the dissolution and transfer of property of the Board of Trustee of the Ayurvedic and Unani Tibia College Delhi to the Tibia College Board and the remaining sections deal with incidental matters such as 203 definitions, constitution of the Board, powers of the Board and so on. One of the conclusion reached by my learned brother is that Ho far as the dissolution of the old Board is concerned the impugned law falls under the second part of Entry 32 and so far the incorporation of the new Board is concerned under its first part. It may be that a legislature may seek to derive its powers to enact a law concerning different topics from various entries in legislative List. But this aspect of a legislatures power has no significance when, in a divided jurisdiction its law is challenged on the ground of encrouchment on a field not open to it. Tho question which would then arise for consideration would be what is the pith and substance of the law? The degree of encroachment made by it on another field would be a guide for ascertaining its pith and substance . Here the impugned Act is aimed at dissolving the petitioner, Board and transferring all its property, rights etc. No doubt, the transfer is to be in favour of a corporation created be the At. No doubt also, that most of the provisions of the act, apart from 3 and 9, deal exclusively with matters pertaining to the newly created entity. But looking to the preamble as well as sections 3 and of the act the creation of new Board and its incorporation is not the pith and substance of the Act. The sole reason for its creation is to transfer to it what was, till then, with the petitioner Board. The new Board was thus to serve only a consequential purpose and its incorporation cannot be said to be the pith and substance of the impugned Act. The activities of the petitioner were not confined to the state of Delhi. That Act cannot there fore, be sustained by reference to the first part of Entry 2. The pith and substance of the law being the dissolution of the petitioner Board, a legal entity, and transference of its property and rights to someone else, it cannot be sustained by reference to the power conferred by the latter part of Entry 32. 204 For sustaining the law the learned Solicitor General had played reliance also on Entries 10 and 28 of List II. What we have to See, therefore, is whether the impugned law could be made by the Delhi Legislature under these entries . It is not disputed that the Petitioner Board is a trustee. It is also clear from the objects with which the trust was established, (which have been set out in the judgment of my learned brother) that it was for a charitable purpose. The petitioner is, therefore, a charitable trust and the object of the law is to dissolve it and transfer its property etc. Entries 10 and 28 of List III run thus: Entry 10: Trust and Trustees". Entry 28: "Charities and charitable institutions, charitable and religious endowments and religious legislatures". The entries are not limited to trusts or charitable institutions which are 'unincorporated societies ' as is the, latter part of Entry 32 of List II. Entry 10 clearly permits a law being made with regard to a trust or trustee which is a separate legal entity. Similarly Entry 32 permits a law to be made affecting charities and charitable institutions of every kind, whether consisting of voluntary associations of individuals or having a corporate or semi corporate character. For, institutions may have a corporate or a semi corporate character as for instance Hindu religious endowments and these are plainly included in the later Entry. The Delhi legislature had, therefore, competence to make a law dissolving a charitable trust and transferring its property, right etc. , to another institution. The aforesaid two entries permit making a law of this kind. No doubt these entries are in the concurrent field but sine the impugned Act was reserved for the assent of the President and was assented to by him on September 12, 1952, it 205 cannot be called in question on the ground of repugnancy with an 'existing law ' or a law made by Parliament. I agree with the view taken by my learned brother on the second and the fourth points urged by Mr. Purshottam and have nothing to add. As regards the third point the argument on behalf of the petitioner is that section 22 of the Government of Part States Act, 1951 (which created a legislature for the Delhi State, then a Part State) precluded the Delhi legislature from enacting a law repugnant to an Act of Parliament and that as the impugned Act contains provisions which are repugnant to those of the , it is ultra vires. Apart from the fact that what a 22 prohibits is a repugnancy with a law made by Parliament itself the is not one of such law the argument does not really arise upon the view I have taken. The petitioner Board upon Registration under that Act becomes a quasi corporation and thus a separate legal entity. Even though it owed its existence to the provisions of the , the Delhi legislature was free to deal with it under its powers under List III because by doing so it did not enact a law repugnant to the provisions of the . That Act still retains its full force and rigour and is unaffected by the impugned Act. The petitioner Board may, by operation of the impugned law, not be able to exercise any of its powers under the but that would be not because the provisions of that law are abrogated in any sense but because the petitioner Board has ceased to exist a a legal entity. The argument must, therefore, be rejected. The petition is, therefore, dismissed with costs. Petition dismissed.

The Board of Trustees, Ayurvedic and Unani Tibbia College, Delhi was registered under the . It ran the Tibbia College, Delhi and an attached hostel and managed the Hindustani Dawakhana. The Delhi State Legislature passed the Tibbia College Act, 1952, which dissolved the Board, incorporated a new Board and vested all the property and all the rights, powers and privileges of the old Board in the new Board. The petitioners challenged the validity of the Act on the grounds that the old Board was a corporation whose objects were not confined to Delhi and legislation with regard to it would fall under Entry 44 of List I of the Seventh Schedule to the Constitution and as such the State Legislature was not competent to pass the impugned Act, (ii) that the setting up of a new Board as corporation was beyond the powers of the State Legislature, (iii) that the Act violated articles 14,19 and 31 of the Constitution, (iv) that the Act could not override the which was a Central Act, and (v) that the legislature acted mala fide in passing the impugned Act. ^ Held, (per Sinha, C. J. Das, Sarkar and Ayyangar,JJ.) that the State Legislature was competent to enact the impugned Act. On registration under the the old Board did not become a corporation in the sen e of being incorporated within the meaning of Entry 44 of List I; it continued to be an unincorporated society though under the provisions of the it had certain privileges analogous to those of corporations. The provisions in the impugned Act relating to the dissolution of the old Board fell within the second part of Entry 32 of List II which included unincorporated societies. Though the impugned Act while creating the new Board gave it a corporate status, it confined its powers and duties to institutions 157 in Delhi and limited its rights, powers and privileges to the purposes for which it was created. The provisions of the impugned Act relating to the incorporation of the new Board fell within the first part of Entry 32 of List II. Taff Vale Railway vs Amalgamated Society of Railway Servants, and Bonsor vs Musicians ' Union, , referred to. Krishnan vs Sundaram, (1940) 43 Bom. L.R. 562, Boppana Rukminiamma vs Maganti Venkata Ramadas, A.I.R. 1940 Mad. 946, and M. A. Nunnier vs Official Assignee, Madras, A.I.R. 1951 Mad. 875 and Satyavart Sidhantalankar vs The Arya Samaj, Bombay, , distinguished. The Servants of India Society, Poona vs The Charity Commissioner of Bombay, (1960) 63 Bom. L.R. 379, approved. Held, further, that the impugned Act did not violate articles 14,19 or 31. The petitioner had failed to show that there were other institutions similarly situated as the petitioner and that the petitioner had been picked out for unequal treatment. Since the transfer of management was made by a valid law there was no question of violation of article 31 (1); and since the impugned Act did not provide for compulsory acquisition of property article 31(2), as it stood at the relevant time, had no application. Neither the dissolved Board nor its member had any right to hold the property of the dissolved Board and there was no infringement of article 19(1)(f) involved in the Act vesting the property in the new Board. Under the , the members of a society did not acquire any beneficial interest on the dissolution of the society; the only right which they had was to determine as to which other society the property should be ' given to for management. This was not a right to property within the meaning of article 19(1)(f) and the taking away of such a right by the impugned Act did not violate article 19(13(f). (Chiranjit Lal Chowdhuri vs The Union of India, ; , relied on. State of West Bengal vs Subodh Gopal Bose, ; and Dwarkadas Shrinivas vs The Sholapur Spinning and Weaving Co., Ltd. ; , distinguished. Held, further, that there was no question of conflict between a law made by Parliament and a law made by the State Legislature as the , was not a law made by Parliament. The State Legislature had the power either to amend the in respect of unincorporated societies, or to make a law relating to a corporation provided its activities were confined to Delhi. The Delhi State Legislature did not transgress any of its limitations in 158 enacting the impugned Act and no question of mala fides of the legislature arose. K.C. Gajapati Narayn Deo vs The State of Orissa, relied on. Per, Mudholkar, J., Though the old Board could not be regarded as a corporation as the does not provide for incorporation it possessed some of the attributes of a corporation and it was a 'near corporation ' or a 'quasi corporation '. It was a legal entity. The second part of Entry 32 of List II did not permit a law to be made which took away from an existing legal entity its powers such as those conferred by the and which destroyed the legal entity. The impugned Act could not be supported under the first part of Entry 32 of List II as the objects of the Board were not limited to the Delhi State. But Entries 10 and 28 of List III permitted the State Legislature to make a law dissolving a charitable trust and transferring its property, rights etc. to another institution and the impugned Act could be sustained under these Entries. Servants of India Society, Poona vs The Charity Commissioner of Bombay, (1950) 63 Bom. L. R. 397, The Taff Vale Railway Co. vs The Amalgamated Society of Railway Servants, ; and Bonsor vs Musicians ' ' Union, , referred to.

Civil Appeal No. 587 of 1960. Appeal by special leave from the award dated December 16, 1958, of the Industrial Tribunal, Bombay, in Reference (I. T.) No. 387 of 1958. M. C. Setalvad, Attorney General of India and I. N. Shroff, for the appellant. K. R. Choudhuri, for respondnet No. 1. Naunit Lal, for respondent No. 2. 1961. November 17. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This appeal by special leave arises out of the proceedings taken at the instance of the appellant, the Kirloskar Oil Engines Ltd., Kirkee, Poona under section 36A of the (14 of 1947) (hereafter called the Act). It appears that certain disputes pending between the appellant and the respondents, its workmen, were referred to the industrial tribunal for its adjudication by the Government of Maharashtra. The disputes in question related to seven demands made by the respondents: two of these were in regard to privilege leave and allowances. The tribunal which tried the dispute made its award in two parts. of the award which dealt the demand of privilege leave and different kinds of allowances was made on June 30, 1958, and published on July 7, 1958. On August 2, 1958, the appellant applied to the State Government for reference of certain points to the tribunal for its clarification under section 36A. Accordingly an order of reference was made in respect of the two items privilege leave and allowances. The tribunal has made the necessary clarification in regard to its direction as to privilege leave. It has, however, held that the direction made by it for the payment to the workmen under paragraph 14 of its award needed no clarification. It held that in substance 493 the appellant was seeking for a modification of the said direction and that could not be done in the clarification proceedings contemplated by section 36A. The clarification award was thus made by the tribunal and submitted to the Government. It is against this award that the appellant has come to this Court by special leave. It would be convenient at this stage to indicate briefly the nature of the clarification claimed by the appellant before the tribunal. In regard the claim for privilege leave the original award by paragraph 10 had directed as follows: "All the workmen, both daily and monthly rated, get privilege leave according to the provisions of the . The leave usually comes to 14 or 15 days in a year I consider a privilege leave of 15 days a year to both the sections of the workmen in the Kirloskar oil Engines as quite adequate. At present this leave is allowed to be accumulated for two years. Here I am of the opinion that the accumulation should be up to 45 days. I therefore direct that all the workmen of the Kirloskar Oil Engines Ltd., Poona, shall be granted 15 days privilege leave (including privilege leave under the ) which will be allowed to be accumulated up to 45 days. " The appellant apprehended that the direction of the award may justify a claim by every worker whose name is on the muster roll to 15 days privilege leave irrespective of his actual attendance during the year. In other words, the appellant argued before the tribunal in the present proceedings that the words used by the original award were wide enough to justify a claim for 15 days privilege leave even where the workman was absent from work, for say 360 days in a year, provided his name appeared on the muster roll of the appellant. The tribunal appreciated the force of this 494 argument. It is common ground that under section 79 of the , it is only where a worker has worked for a period of 240 days or more in a factory during a calendar year that he becomes entitled during the subsequent calendar year to leave with wages for a number of days calculated at the rate of one day for every twenty days of work performed by an adult worker in the previous calendar year, or at the rate of one day for every fifteen days work performed by a child. The tribunal observed that it was not the intention of the award to depart from the basic principle prescribed by section 79; and so it made the necessary clarification by adding that in order to entitle him to the privilege as directed by the award every workman must put in 240 days or more of actual working during the previous calendar year. Thus, in regard to the provision made by the award as to privilege leave the clarification claimed by the appellant was made. In regard to the second point on which clarification was sought the relevant direction in the award reads thus: "At present if a workman works on a weekly off or on a holiday, he gets a substituted holiday under the but no additional payment. In my opinion a workman makes plans well in advance about spending his holidays. He spends his time in the company of his colleagues and refreshes himself. If he gets a substituted holiday, he is deprived of his enjoyment. He should therefore be compensated in money as well as by a day off. I therefore direct that if a workman has to work on a weekly off or on a holiday (paid or unpaid) he should be paid 1 1/2 times his wages and dearness allowance over and above substituted holiday. " 495 The appellant urged before the tribunal that this direction needed to be clarified because as it stood it was likely to impose on the appellant very heavy financial burden. The tribunal held that the direction itself was very clear and that under the guise of clarification the appellant was seeking its modification. So the tribunal rejected the appellant 's claim for any clarification in that behalf. In the present appeal the learned Attorney General attempted to argue that the accumulation of privilege leave up to 45 days allowed by the award was not justified. In our opinion, this argument cannot be entertained in the present appeal for two reasons. First, no such plea appears to have been made before the tribunal in the present clarification proceedings and so the appellant cannot be allowed to raise a new plea now. Besides, it is necessary to bear in mind the limitations of the enquiry permitted under the proceedings contemplated by section 36A of the Act. The said section empowers the appropriate Government to refer any question to the tribunal if the said Government is satisfied that any difficulty or doubt arises as to the interpretation of any provision of an award made by the said tribunal. It further provides that when such a question is referred to it the tribunal shall, after giving the parties an opportunity of being heard, decide such question and its decision shall be final and binding on all such parties. It is thus clear that the scope of the enquiry under section 36A is limited to the decision of the difficulties or doubts arising as to the interpretation of any provision in the award. If the words used in any provision of an award are ambiguous or obscure and it is not reasonably possible to interpret them the difficulty arising from the use of such ambiguous or obscure words may be resolved by moving the appropriate Government to make a reference under section 36A. It is obvious 496 that any question about the propriety, correctness or validity of any provision of the award would be outside the purview of the enquiry contemplated by the section. If a party to the award is aggrieved by any of its provisions on the merits the only remedy available to it is by making an appeal, say for instance under article 136 of the Constitution, to this Court. A grievance felt by a party against any provision of the award can be ventilated only in that way and not by adopting the procedure prescribed by section 36A. Thus, the enquiry permissible under section 36A is limited to the question of the interpretation of the provision of the award in question and no more. That is why, we think, that even if the appellant had sought to raise the question about the propriety of allowing the accumulation of privilege leave up to 45 days before the tribunal, and even if such a question had been referred by the State Government to the tribunal under section 36A, the tribunal would have been justified if in refusing to consider it because the point raised had nothing to do with the interpretation of the provision but is concerned with its merits and its propriety. Therefore, in our opinion, the appellant is not entitled to raise this point before us in the present appeal. The next contention raised by the appellant is against the refusal of the tribunal to entertain its application for clarification in regard to the provision for the payment to the worker 1 1/2 times his wages and dearness allowance over and above a substituted holiday if he has to work on a weekly off or on a holiday (paid or unpaid). The grievance of the appellant in substance is that in 1956 and 1957, on account of shortage of electrical energy for industrial purposes the State Government compelled the factories to change their weekly holidays from Sunday to some other week day, each factory or group of factories observing one week day as weekly off. According to the appellant, if a handful of workmen are to work on a weekly off or on a 497 holiday when the whole factory is closed then there would be some justification for making the payment to the workmen required to work on such a day; but there would be no justification for making such payment where the whole factory works on a weekly off or on a holiday. In support of this contention the appellant relies on the observation made in the original award that the basis for directing the additional payment for working on a weekly off or on a holiday is that the workman is deprived of an opportunity to spend his time in the company of his colleagues and refresh himself. It is urged that when all his colleagues are working there is no point in saying that anyone is deprived of an opportunity to spend his time in the company of his colleagues. The tribunal was not impressed by this argument and so it has refused to make any clarification cum modification in its award. It is significant that the argument based on the orders issued by the State Government requiring the factories to change their weekly holidays owing to shortage of electric energy was not raised before the tribunal at the time when it originally heard the dispute between the parties. It has stated in the present order that it looked at its notes of arguments and noticed that no such plea was raised before it at that time. Besides the tribunal has observed that having regard to the definition of the word "week" under section 2 (f) of the as well as the provisions of section 52 of the said Act it would have been open to the appellant to have another day of the week declared as the first day of the week for its purposes. If the appellant had adopted such a course the difficulty on which it relied would not have arisen. The appellant contends that the reasons given by the tribunal in rejecting its claim for clarification are not sound. We are not impressed by this argument. As we have already pointed out, the present argument ignores the limitations of the scope of the 498 enquiry under section 36A. It is clear that in substance the argument is that the direction issued by the award in regard to the payment in question should be modified, and in support of the claim for modification reliance is placed on the relevant orders issued by the State Government for changing the weekly holidays. Such a claim cannot obviously be entertained in clarification proceedings under section 36A. A proceeding contemplated by section 36A is not a proceeding intended to enable the tribunal to review or modify its own order; it is intended to enable the tribunal only to clarify the provisions of its award where a difficulty or doubt arises about the interpretation of the provisions. Quite clearly the impugned provisions contained in paragraph 14 of the award in relation to this demand are clear and unambiguous. Whatever may be the appellant 's grievance in respect of the validity or the propriety of the said directions there is no difficulty or doubt about their meaning; and so we are satisfied that the tribunal was right in refusing to alter the said direction in the present proceedings. The result is the appeal fails and is dismissed with costs. Appeal dismissed.

Certain disputes between the appellant and its workmen were referred to the industrial tribunal for adjudication by the State Government under the provisions of the . The award made by the tribunal provided, inter alia, (1) that if a workman had to work on a weekly off or on a holiday he should be paid 1 1/2 times his wages and dearness allowance over and above a substituted holiday, and (2) that all the workmen shall be granted 15 days privilege leave in a year which could be allowed to be accumulated up to 45 days. The appellant applied to the Government under section 36A of the Act stating that the directions given by the tribunal had to be clarified on the grounds, inter alia, (1) that the reason for directing the additional payment for working on a weekly off or on a holiday was that the workman was deprived of an opportunity to spend his time in the company of his colleagues and refresh himself, but that there was no basis for this since the whole factory worked on weekly off or on a holiday, and (2) that the accumulation of privilege leave of 45 days to all workmen was not justified. The tribunal made a clarification as regards privilege leave confining it to only those workmen who had put in 240 days or more of actual working during the previous calendar year so as to be in conformity with the provisions of the , but as regards others matters it held that the directions given were quite clear and that under the guise of clarification the appellant could not seek a modification of the award under section 36A. ^ Held, that 36A of the , was intended to empower a tribunal to clarify the provisions of the award passed by it where a difficulty or doubt arose about their interpretation, and not to review or modify its own order. Any question about the propriety, correctness or validity of any provision of the award would be outside the purview of the enquiry contemplated by that section.

Civil Appeal No. 144 of 1960. Appeal by special leave from the judgment and order dated July 26, 1957, of the Madhya Pradesh High Court in Civil Revision No. 966 of 1955. B. R. L. Iyengar and K. P. Bhatt, for the appellant. G. section Pathak, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondents. November 16. The Judgment of the Court was delivered by SARKAR, J. In this case an arbitration agreement had been filed in court under section 20 of the , and an order of reference made thereon. The arbitrator in due course entered 477 upon the reference and made and filed his award in court on July 14, 1955. The award concerned partition of certain properties between the wife and children of one Bhairon Bux. The award was however unstamped and unregistered. An objection was taken to a judgment being passed on such an award. On such objection, the trial court passed an order remitting the award to the arbitrator for re submitting it to the court on a duly stamped paper and after getting it registered. Against this order the High Court at Nagpur was moved in revision. The learned Single Judge hearing the revision application took the view that the award required to be stamped. But he felt that it could not be remitted to the arbitrator under section 16 of the , which is the only provision under which an award can be remitted to an arbitrator. It appears that there was an earlier judgment of the Nagpur High Court in the case of Ramkumar vs Kushalchand (1) in which it had been held that where the award was unstamped it could under paragraph 14 of Schedule I to the Code of Civil Procedure be remitted to the arbitrator with a direction to re write it on a stamped paper and re submit it to court. The provisions of that paragraph of the Code have now been substantially reproduced in section 16 of the . The trial Judge had based himself on this earlier judgment of the High Court. The learned Single Judge was apparently not satisfied with the correctness of the decision in Ramkumar 's case (1) and he referred three questions for decision by a larger bench of that High Court. The questions referred were: (a) Is the award made on a reference by the Court on an application under section 478 20 of the chargeable to stamp duty? (b) Is such an award compulsorily registerable when it relates to partition of immovable property of the value of one hundred rupees and upwards? (c) Has the Court powers under section 16(1) (c) of the of 1940 or otherwise to remit an award to the arbitrator or umpire to get it stamped and/or registered? The matter was thereupon heard by a Division Bench of the High Court constituted by two learned Judges. Before them it was agreed by both the parties that the award required to be stamped. This disposed of the first question. The learned Judges felt that it was not necessary at that stage of the proceeding to answer the second question, namely, whether the award required registration. In the result they only answered the third question as to whether an award could be remitted under section 16 (1) (c) of the to the arbitrator to get it stamped and they answered that question in the affirmative. They held that a want of stamp would be an illegality apparent on the face of the award and therefore the case would fall under section 16(1)(c) of the . They also held, following the case of Lakhmichand vs Kalloolal (1), that the copying of the award on a stamped paper was purely ministerial, and making of an award did not deprive the arbitrator of the authority to copy an award on the requisite stamp paper. They approved of the decision in Ramkumar vs Kushalchand (1). The present appeal is against this judgment of the Division Bench. The only question argued at the bar was whether the answer of the Division Bench to the third question was correct. 479 Now section 16(1)(c) of the Act is in these terms: section 16 (1): The Court may from time to time remit the award or any matter referred to arbitration to the arbitrators or umpire for reconsideration upon such terms as it thinks fit . . . . . . . (c) where an objection to the legality of the award is apparent upon the face of it. We think that the Division Bench of the High Court was clearly in error. Under section 16 of the an award can be remitted to the arbitrators only for reconsideration. When it is remitted for re writing it on a stamped paper, it is not remitted for reconsideration. Reconsideration by the arbitrators necessarily imports fresh consideration of matters already considered by them. Now they can only consider and give a decision upon matters which are referred to them under the arbitration agreement. It follows that the reconsideration can only be as to the merits of the award. They reconsider nothing when they re write the award on a stamped paper. We think the matter was correctly put by Mitter, J., in Nani Bala Saha vs Ram Gopal Saha (1) in the following observation: "That cl. (c) means this and nothing more: namely, that where the court finds an error of law in the award itself or in some document actually incorporated thereto on which the arbitrator had based his award, that is to say, finds the statement of some erroneous legal proposition which is the basis of the award, it can remit the award to the arbitrator for reconsideration" and "Want of registration is a defect dehors the award or the decision of 480 the arbitrator, and so in our judgment is not covered by cl. (c) of section 16 (1), of 1940". What was said there about a want of registration is clearly equally applicable to a want of stamp. Mr. Pathak appearing for the respondent contended that under section 14 (1) of the it was clearly the duty of the arbitrator to inform the parties of the amount of stamp duty payable on the award. Section 14 (1) is in these terms: Section 14 (1) When the arbitrators or umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and award. We are unable to see how this section can provide the basis for the order made in this case. It only says that the arbitrators shall inform the parties of the fees and charges payable. Even assuming that the word 'charges ' includes duty payable for the stamp to be affixed to the award, at best, this section would support an order directing the arbitrators to supply this information. It would not justify an order requiring the arbitrators to inscribe the award afresh on a stamped paper and re submit it to court. As at present advised, we have grave doubts if the fees and charges mentioned in section 14 (1) include the stamp duty payable on the award. Section 17 of the Stamp Act requires that stamping should be at the time of execution. Under section 14 (1) of the it is only after the singing of the award that is its execution, that the arbitrators are required to supply the information about the fees and charges. It is, of course, no part of the duty of the arbitrators under the Act or otherwise to find the costs of stamp themselves. Therefore 481 it is difficult to appreciate how the word `charges ' mentioned in this section includes stamp. But on this question it is not necessary for us to express any final opinion in this case. Mr. Pathak contened that even if the case did not come within section 16 (1) (c) of the , the order in the present case can be supported under section 151 of the Code of Civil Procedure which preserves the inherent power of a court to make such orders as may be necessary for the ends of justice. It is true that section 41 of the makes the provisions of the code of Civil Procedure applicable to proceedings before a court under the . But it is well known that after making his award the arbitrator is functus officio. To cite one authority for this proposition we may quote the observations of Mellish, L. J., in Mordue vs Palmer(1). "I think the result of the cases at law is that when an arbitrator has signed a document as and for his award, he is functus officio, and he cannot of his own authority remedy any mistake." In the present case, ex hypothesi, the award has already been made and the arbitrator has therefore become functus officio. It is that award which requires stamp. Section 151 of the Code cannot give the court power to direct the arbitrator to make a fresh award; that would be against well established principles of the law of arbitration. It would again be useless to have another copy of the award prepared and stamped for the copy would not be the award and no action in a court can be taken on it. The order cannot therefore be supported by section 151 of the Code. It is of some interest to read here the following passage from Russel on Arbitration 14th Ed., p. 325. 482 "The usual practice in preparing an award is to have two copies made of it. One the arbitrator signs, which then becomes then the original award, and this is delivered to the party who takes up the award. The other copy is available for the other parties if they apply for it." "The original award, before it is available for any purpose whatsoever, must be duly stamped, but there is no obligation upon the arbitrator to stamp it, and he does not usually do so. " We should observe here that the last paragraph in the aforesaid quotation does not appear in the 16th edition of Russel 's work. Perhaps this is because in England an award is no more required to be stamped by virtue of section 35 Sched. 8, of the Finance Act, 1949, which was passed after the 14th edition was published. Lastly, Mr. Pathak tried to support the order under sections 13 (d) and 15 (b) and (c) of the . A bare perusal of the provisions mentioned would show that the order made in this case cannot be based on any of them. Section 13 (d) deals with correction of clerical mistakes or accidental slips in the award, neither of which we think an omission to stamp is. Further more, section 13 is only an enabling section giving certain powers to the arbitrator. The arbitrator cannot be compelled to exercise these powers. Section 15 deals with a court 's power to modify or correct an award. In the present case, the Court did not purport to exercise that power. We, therefore, think that the Division Bench was in error in thinking that an order could be made remitting the award to the arbitrator with a direction to re write it on a stamped paper and resubmit it to court. That is the only point that we decide in this case. 483 In the result this appeal is allowed. The orders of the Courts below remitting the award are set aside. The appellant will get the cost throughout. Nothing that we have said in this judgment will affect the right of the parties to take such steps, if any are available to them at law, for curing the defect arising from the award being on an unstamped paper. Appeal allowed.

An arbitration agreement was filed in court under section 20 of the , and an order of reference was made thereon. The arbitrator entered upon the reference and in due course filed his award in court. The award was however, unstamped and on objection raised that no judgment 476 could be passed on such an award, the trial court passed an order remitting the award to the arbitrator for re submitting it to the court on duly stamped paper. The High Court took the view that want of stamp would be an illegality apparent on the face of the award, which could therefore be remitted under section 16(1) (c) of the Act. ^ Held, that all unstamped award cannot be remitted under section 16(1) (c) of the , to the arbitrator to get it stamped, because want of stamp is a defect dehors the award or the decision of the arbitrator and does not amount to an illegality apparent upon the face of it within the meaning of that section. Ramkumar vs Kushalchand, A.I.R. 1928 Nag. 166 and Lakshmichand vs Kalloolal, 1956 N.L.J. 504, disapproved. Nani Bala Saha vs Ram Gopal Saha, A.I.R. 1945 Cal. 19, approved. Held, further, that after making an award the arbitrator is functus officio, and section 151 of the Code of Civil Procedure cannot therefore give the court power to direct the arbitrator to make a fresh award and re submit it after writing it on proper stamp paper. Mordue vs Palmer, , relied on. Dubitante, it is doubtful if the fees and charges mentioned in section 14(1) of the Arbitration act, 1940, include the stamp duty payable on the award.

eview Petition No. 16 of 1960. 519 Petition for Review of this court 's Judgment and order dated April 26, 1960, in Civil Appeal No. 64 of 1956. A. V. Viswanatha Sastri, R. Ganapathy Iyer and Gopalkrishnan, for the petitioners. K. N. Rajagopala Sastri, and P. D. Menon, for respondent. November 23. Das, J., delivered his own Judgment. The Judgment of Kapur and Hidayatullah, JJ. was delivered by Hidayatullah, J. section K. DAS, J. I had taken a view different from that of my learned brethren when this appeal was heard along with Pringle Industries Ltd., Secunderabad vs The Commissioner of Income tax, Hyderabad (1), and that view was expressed in a very short judgment dated April 26, 1960. Now, we have had the advantage of hearing a very full argument with regard to the facts of the appeal, and I for myself have had the further advantage and privilege of reading the judgment which my learned brother Hidayatullah, J., is proposing to deliver in this appeal. I have very carefully considered the question again with reference to the facts relating thereto and, much to my regret, have come to the conclusion that I must adhere to the opinion which I expressed earlier. My view is that the facts of this case are indistinguishable from the facts on which the decision of the Privy Council in Mohanlal Hargovind vs Commissioner of Income tax, C.P. and Berar(2) was rendered, and on the principles laid down by this court in Assam Bengal cement Co., Ltd. vs The Commissioner of Income tax, West Bengal (3), it must be held that the expenditure of Rs. 6111/ in this case was on revenue account and the respondent firm was entitled to the allowance which it claimed. 520 The short facts are these. The respondent firm carried on a business in the purchase and sale of conch shells (called chanks). It used to acquire the stock of conch shells (1)by purchase from the Fisheries purchase from the Fisheries Department of the Government of Madras and (3) by fishing for and gathering such shells from the sea. It disposed of the stock so acquired at Calcutta, the different between the cost price and selling price less expenses being its profit made in business. On November 9 1945 it took on lease from the Director of Industries and Commerce, Madras, the exclusive right. liberty and authority to fish for, take and carry away "chank" shells in the sea off the coast line of the South Arcot District including the French Kuppama of Pondicherry. The boundary of the area within which the right could be exercised was given in a schedule to the lease. The lease was for a period of three years from July 1, 1944 to June 30 1947 on a consideration of an yearly rent of section 6111/ to be paid in advance. Clause 3 of the lease contained the material terms there of and may be set out in full. The lesser hereby convenants with the lesson as follows: (i) To pay the rent on the day and in manner aforesaid. (ii) To deliver to the Assistant Director of Pearl and Chank Fisheries, Tuticorn all Velampuri shells that may be obtained by the lessee upon payment of their value as determined by the Assistant Director. (iii) To collect chanks caught in nets and by means of diving as well. In the process of such collection of shells not to fish chank shells less than 2/1/4 inches in diameter and if any chank shells less than 2/1/4 inches in 521 diameter be brought inadvertently to shore, to return at once alive to the sea all such undersized shells. (iv) Not at any time hereafter to transfer or underlet or part with possession of this grant or the rights and privileges hereby granted or any part thereof without the written consent of the lessor. (v) At the end or sooner determination of the term hereby created peaceably and quietly to yield to the lesson the rights and privileges hereby granted, and (vi) To report to the Assistant Director of Pearl and Chank Fisheries (South), Tuticorn the actual number of shells kept unsold in different stations after the expiry of the lease period. For the assessment year 1946 47, the respondent firm submitted a return of its income to the Income tax Officer, Karaikudi Circle, showing its income from sale of chanks purchased from divers at Rs. 7194/ by sale of chanks purchased from Government Department at Rs. 23, 588/ and Rs. 2819/ by sale of chanks gathered by themselves (through divers) after deducting Rs. 6111/ being the rent paid to Government under the contract referred to above. It sought to deduct Rs. 6111/ from its profits from business on the ground that this was an expenditure not of a capital nature but wholly and exclusively laid out for the purpose of business under section 10(2)(xv) of the Income tax Act. This claim was disallowed by the Income tax Officer and on appeal by the Appellate Assistant Commissioner. On further appeal to the Appellate Tribunal the respondent firm contended that the 522 decision of the Privy Council in Mohanlal Hargovind vs Commissioner of Income tax(1)applied to this case inasmuch as the payment was to secure the stockin trade for its business. The Appellate Tribunal was of the opinion that the Privy Council decision covered the case, but felt itself bound by the decision of the Full Bench of the Madras High Court in K. T. M. T. M. Abdul Kayum Hussain Sahib vs Commissioner of Income tax, Madras (2). The Tribunal acceded to the demand for a reference to the High Court, and accordingly referred the following question to the High Court for its decision. "Whether on the facts and circumstances of the case the payment of the sum of Rs. 6111/ made by the assessee under the terms of the agreement entered into with the Director of Industries and Commerce, Madras on 9th November, 1945 was not an item of revenue expenditure incurred in the course of carrying on the business of the assessee and, therefore, allowable under the provisions of section 10 of the Indian Income tax Act?" The reference first came before a Division Bench and was then referred to a Full Bench. By its judgment dated April 2, 1953 the Full Bench answered the question in favour of the respondent firm. On a certificate of fitness granted by the High Court the Commissioner of Income tax, Madras, brought the present appeal to this Court. In Assam Bengal Cement Co., Ltd. vs The Commissioner of Income tax (3), this Court referred to the decision in Benarsidas Jagannath. In re.(4) and accepted the following broad principles for the purpose of discriminating between a capital and a revenue expenditure. 523 (1) The outlay is deemed to be capital when it is made for the initiation of a business, for extension of a business, or for a substantial replacement of equipment [See Commissioners of Inland Revenue vs Granite City Steamship Company Ltd.(1)]. Such expenditure is regarded as on capital account, for it is incurred not in earning profits but in setting the profit earning machinery in motion. In my opinion this test does not apply in the present case where no profit earning machinery was set in motion. (2) Expenditure may be treated as properly attributable to capital when it is made not only once and for all, but with a view to bringing into existence an asset or an advantage for the enduring benefit of a trade. [See Atherton vs British Insulated and Helsby Cables Ltd. (2)]. In elucidation of this principle it has been laid down in several decisions that by "enduring" is meant "enduring in the way that fixed capital endures" and it does not connote a benefit that endures in the sense that for a good number of years it relieves the assessee of a revenue payment. In Robert Addie & Sons Collieries Ltd. vs Commissioners of Inland Revenue (3) Lord Clyde formulated the same test in these words: "What is 'money wholly and exclusively laid out for the purposes of the trade ' in a question which must be determined upon the principles of ordinary commercial trading. It is necessary accordingly to attend to the true nature of the expenditure, and to ask one 's self the question, is it a part of the Company 's working expenses? is it expenditure laid out as part of the process of profit earning? or, on the other hand, is it a capital outlay? is it expenditure necessary for the acquisition of property or of rights of a permanent character, 524 the possession of which is a condition of carryin on its trade at all?" This test was adverted to by the Privy Council in Tata Hydro Electric Agencies Ltd. vs Commissioner of Income tax(1).In my opinion the application of this test makes it at once clear that the sum of Rs. 6111/ which the respondent firm spent was expenditure laid out as part of the process of profit earning; it was not a capital outlay, that is, expenditure necessary for the acquisition of property or of rights of a permanent character, the possession of which was a condition of carrying on its trade. Under the contract in question the respondent firm did not acquire any right to immovable property. It acquired no right in the bed of the sea or in the sea. The only right conferred on the respondent firm was the right to fish for, gather and carry away conch shells (in motion under the surface of the sea) of a specified type and size. The respondent firm was under an obligation to return to the sea conch shells less than 2 1/2 inches in diameter. The business of the respondent firm consisted in buying and selling conch shells. No manufacturing process was involved in it. Therefore, the stock in trade of the respondent firm was conch shells. It secured this stock in trade in many different ways, by purchase from divers, by purchase from Government and private parties, and also by gathering conch shells under the contract in question. In my opinion, the contract into which the respondent firm entered was merely for securing its stock in trade. It is indeed true that in considering whether an item of expenditure is of a capital or a revenue nature, one must consider the nature of the concern, the ordinary course of business usually adopted in that concern, and the object with which the expense is incurred. The true nature of the transaction must be collected from the entire 525 document with reference to all the relevant facts and circumstances. Having regard to the nature of the respondent firm 's business and the course adopted by it for carrying it on, it appears to me to be rather far fetched to hold that by the contract in question the respondent firm acquired property or right of a permanent character, the possession of which was a condition of carrying on its trade. To me it seems that the better view, in a business sense, is that the respondent firm merely acquired by means of the contract its stock in trade, rather than a source or enduring asset for producing the stock in trade. It was argued before us, as it was argued in the High Court, that what was acquired in the present case was the means of obtaining the stock in trade for the business rather than the stock in trade itself. I am unable to accept this argument as correct. The contract entered into by the respondent firm was wholly and exclusively for the purpose of obtaining conch shells, which were its stock in trade. As I have stated earlier, the contract granted no interest in the sea, sea bed, or sea water etc. It was simply a contract giving the grantee the right to pick and carry away conch shells of a specified type and size which of course implied the right to appropriate them as its own property. In my opinion, in a case of this nature no distinction can be drawn in a business sense between the right of picking and carrying away conch shells and the actual buying of them. It is not unusual for businessmen to secure, by means of a contract, a supply of raw materials or of goods which form their stock in trade, extending over several years for the payment of a lump sum down. Even if the conch shells were stored in a godown and the respondent firm was given a right to go and fetch them and so reduce them into its ownership, it could scarcely have been 526 suggested that the price paid was capital expenditure. I may explain what I have in mind by giving a simple illustration. Take the case of a fisher may who sells fish. Fish is his stock in trade. He man buy the fish he requires from other persons; or he may obtain the supply of fish he requires by catching the fish of a specified size and type in particular water over a short period under a contract entered into by him and take them away. I do not think that in a business sense any distinction can be made between the two means of obtaining the stock in trade. Both really amount to securing the stock in trade rather than acquiring an enduring asset or a permanent right for producing the stock in trade. And a business man, like the fisher man in the illustration given above, would indeed be surprised to learn that buying of fish for his business is revenue expenditure whereas catching fish in particular water under a contract entered into by him for the purpose of obtaining his stock in trade on payment of a lump sum down, is capital expenditure. (3) The test whether for the purpose of the expenditure, any capital was withdrawn, or, in other words, whether the object of incurring the expenditure was to employ what was taken in as capital of the business does not arise in the present case and need not be considered. No different principles were laid down by my learned brethren in their decision in Pringle Industries Ltd. vs Commissioner of Income tax(1) and so far as that case is concerned, their decision must hold the field. The difficulty and difference of opinion that arise now relate to the application of those principles to the facts of the present case. One is reminded in this case of what Lord Macmillan said in Tata Hydro Electric Agencies Ltd. vs Commissioner of Income tax(2) at page 209: 527 "Their Lordships recognise and the decided cases show how difficult it is to discriminate between expenditure which is and expenditure which is not, incurred solely for the purpose of earning profits or gains. " Lord Greene (Master of the Rolls) expressed himself more strongly and adverting to the distinction between capital and income, said: "There have been many cases where this matter of capital or income has been debated. There have been many cases which fall upon the borderline: indeed, in many cases it is almost true to say that the spin of a coin would decide the matter almost as satisfactorily as an attempt to find reasons." [Vide Commissioners of Inland Revenue vs British Salmson Aero Engines Ltd.(1)]. Perhaps, the case before us is not as bad as the cases which the Master of the Rolls had in mind when he made the above observations. It is, however, a truism that each case must turn upon its own facts. Nevertheless the decisions are useful as illustrations of some relevant general principles. The nearest illustration that we can get is the decision of the Privy Council in Mohanlal Hargovind vs Commissioner of Income tax(2). That decision was binding on the Indian Courts at the time when it was given and as I think that it is still good law and is indistinguishable from the present case, I offer no apology for referring to it in great detail. The facts of that case were these. The assessees there carried on a business at several places as manufacturers and vendors of country made cigarettes known as bidis. These cigarettes were composed of tobacoo rolled in leaves of a tree known as tendu leaves, which were obtained by the assessees by entering into a number of 528 short term contracts with the Government and other owners of forests. Under the contracts, in consideration of a certain sum payable by instalments, the assessees were granted the exclusive right to pick and carry away the tendu leaves from the forest area described. The assesees were allowed to coppice small tendu plants a few months in advance to obtain good leaves and to pollard tendu trees a few months in advance to obtain better and bigger leaves. The picking of the leaves however had to start at once or practically at once and to proceed continuously. On these essential facts, the Privy Council held that the contracts were entered into by the assessees wholly and exclusively for the purpose of supplying themselves with one of the raw materials of their business, that they granted no interest in land, or in the trees or plants, that under them it was the tendu leaves and nothing but the tendu leaves that were acquired, that the right to pick the leaves or to go on to the land for the purpose was merely ancillary to the real purpose of the contracts and if not expressed would be implied by law in the sale of a growing crop, and that therefore the expenditure incurred in acquiring the raw material was in a business sense an expenditure on revenue account and not on capital, just as much as if the tendu leaves had been bought in a shop. I can find no distinction which would make any difference between the facts of that case and the facts of the present case. Let me compare the essential facts of these two cases and see whether there is any difference. (1) Two of the contracts were taken as typical of the rest by the Privy Council. One contract was for the period from September 5, 1939 to June 30, 1941 and the other was for the period from October 1, 1938 to June 30, 1941. Thus one of the contracts was for a period of about two years and the other contract for a period of about three years. 529 In the case under our consideration the period of the contract is three years. Indeed, there is no vital difference between the periods in the two cases. (2) In the case before us the contract area is described in a schedule. In the two contracts which were under consideration by the Privy Council the contract area was also indicated in a schedule. The boundaries of the forests in which tendu leaves could be plucked were delimited by the schedule. Same is the case with the contract before us. The contract area in which conch shells of a specified type and size can be picked and gathered is described in a schedule. Such description does not mean that the assessee gets any right other than the right to gather conch shells. In the Privy Council case the assessees were granted no interest in land or in the trees or plants; it was the tendu leaves and nothing but the tendu leaves that were acquired. In the case before us no interest was given in the sea bed or in the sea water or in any of the products thereof. Conch shells of a specified type and size and nothing but such conch shells were acquired by the contract. I do not think that the reference to the coast line off the South Arcot District makes any difference between the present case and the case on which the decision in Mohanlal Hargovind vs Commissioner of Income tax (1) was rendered. If in the matter of plucking of tendu leaves the expenditure under the contract was, in a business sense, expenditure on revenue account, I fail to see why a similar expenditure for gathering conch shells in motion under the surface of the sea near the coast line should not, in a business sense, be considered as expenditure on revenue account. This aspect of the case was emphasised by their Lordships in the following paragraph: 530 "It appears to their Lordships that there has been some misapprehension as to the true nature of these agreements and they wish to state at once what in their opinion is and what is not the effect of them. They are merely examples of many similar contracts entered into by the appellants wholly and exclusively for the purpose of their business, that purpose being to supply themselves with one of the raw materials of that business. The contracts grant no interest in land and no interest in the trees or plants themselves. They are simply and solely contracts giving to the grantees the right to pick and carry away leaves, which of course, implies the right to a appropriate them as their own property. " In the case under our consideration the only right granted to the respondent firm was to take and carry away conch shells of a specified type and size, which of course, implies the right to appropriate them as the respondent firm 's own property. The right to go into the sea and cast nets etc. was merely ancillary to the real purpose of the contract. Nor do I think that the circumstance that the contracts conferred an exclusive privilege or right is a matter of any significance. In Mohanlal Hargovind vs Commissioner of Income tax (1) the contracts were exclusive and their Lordships stated: "It is true that the rights under the contracts are exclusive but in such a case as this that is a matter which appears to their Lordships to be of no significance. These observations are as apt in their application to the present case as they were in the case before their Lordships of the Privy Council. (3) The Privy Council draw a distinction between cases relating to the purchase or leasing of 531 mines, quarries, deposits of brick earth, land with standing timber etc. On one side and the case under its consideration on the other. It referred to the decision in Alianza Co. vs Bell(1) and said: ". the present case resembles much more closely the case described and distinguished by Channell, J. at page 673 of the report in Alianza Co. vs Bell of the cost of material worked up in a manufactory. That side the learned Judge, is a current expenditure and does not become `a capital expenditure merely because the material is provided by something like a forward contract, under which a person for the payment of a lump sum down secures a supply of the raw material for a period extending over several years '. " In Kauri Timber Co. Ltd. vs Commissioner of Taxes(2) the company 's business consisted in cutting and disposing of timber. It acquired in some cases timber bearing lands, in other cases it purchased the standing timber. The leases were for 99 years. So far as the cases where the land was acquired were concerned there could have been no doubt that the expenditure made in acquiring it was capital expenditure. In the case of the purchase of the standing timber what was acquired was an interest in land. The purchasers bought the trees which they could allow to remain standing as long as they liked. It was pointed out that so long as the timber at the option of the company remained upon the soil, it derived its sustenance and nutriment from it. The additional growths became ipso jure the property of the company. In these circumstances it was held that the expenditure was capital expenditure. In the case before us some reliance was placed by the appellant on the term that shells less than 2 1/4 inches in diameter brought inadvertently to shore had to be returned at once alive to the sea. 532 The argument was that such shells might later grow in size by receiving sustenance and nutriment from sea water and could be later gathered by the respondent firm when they reached the size of 2 1/4 inches in diameter or more. This, it was argued, brought the present case nearer the decision in Kauri Timber case (1). I am unable to agree. It is to be remembered that live shells move under the surface of the sea and they do not remain at the same place, as trees do. A shell less than 2 1/4 inches in diameter returned alive to the sea may move away from the contract area and may never be gathered by the respondent firm. In these circumstances the appellant is not entitled to call to his aid the test of "further vegetation" or "sustenance and nutriment" referred to in the Kauri Timber case (1). From whatever point of view we may look at the case, it seems to me that the facts of the present case are indistinguishable from those of the case in Mohanlal Hargovind vs Commissioner of Income tax(2) In Mohanlal Hargovind 's case (2) the right was to pluck tendu leaves; in our case the right was to gather conch shells of specified type and size. This distinction, it is obvious, makes no difference. In the High Court it was contended on behalf of the appellant that Mohanlal Hargovind 's case (2) related to the acquisition of raw materials whereas the present case relates to the acquisition of "chanks" by a dealer who sells them without subjecting them to any manufacturing process, and this distinction, it was contended, made the decision in Mohanlal Hargovind 's case (2) inapplicable to the present case. The High Court rejected this contention and in my opinion rightly. I agree with the High Court that on principle and in a business sense, there is no distinction between acquiring raw materials for a manufacturing business and acquiring or purchasing goods by a dealer for the purpose of sale, particularly when there is no question of any excavation 533 etc., in order to win the goods and make such goods parts of the stock in trade, a point which weighed with the Court of Appeal in Stow Bardolph Cravel Co. Ltd. vs Poole (1) and with my learned brethren in Pingle Industries Ltd. V. Commissioner of Income tax (2). No such point is present in this case. I have been unable to find any other distinction between the two cases which would make a difference in the application of the principles for discriminating between capital expenditure and revenue expenditure. To adopt again the language of Lord Green, I see no ground in principle or reason for differentiating the present case from the case in Mohanlal Hargovind vs Commissioner of Income tax (3). On behalf of the respondent firm a further question was agitated, namely, whether an allowance for the cost of gathering the conch shells by nets etc., should not be given, even though the rent paid under the contract was not allowable, under section 10 (2) (xv) of the Income tax Act and a reference was made in this connection to the decision in Hood Barrs vs Commissioners of Inland Revenue (4). I do not think that we are concerned with that matter in the present appeal. The only question which arises for decision is the one referred to the High Court. I have held that the High Court correctly answered the question which related to the payment of the sum of Rs. 6111/ only. The question having been correctly answered by the High Court, the appeal fails and must be dismissed with cost. HIDAYATULLAH, J. This appeal was heard with Pingle Industries, Ltd., Secunderabad vs The Commissioner of Income tax (5), in which judgment was delivered by us on April 26 1960. In accordance with the decision in Pingle Industries case (1), 534 this appeal was allowed. Later, a review petition of (No. 16 of 1960) was filed on the ground that this appeal was not governed by the decision in Pingle Industries case (1), and that as it was not fully argued, it should be reheard. It is unnecessary to go into the reasons why the rehearing was granted, except to say that there was perhaps a misunderstanding about the concessions made by counsel. We were, therefore, satisfied that we should grant the rehearing, and have since heard full arguments in this appeal. K. T. M. T. M. Abdul Kayoom and Hussain Sahib (respondent) is a registered firm, and carries on business in conch shells locally known as "chanks", which are found on the bed of the sea all along the coast line abutting on the South Arcot District. The respondent took on lease from the Director of Industries and Commerce, Madras "the exclusive right, liberty and authority to take and carry away all chanks founnd in the sea" for a period of three years ending on June 30, 1947. The consideration was Rs. 6, 111/ per year payable in advance. For the year of assessment, 1946 47 (the year of account ending June 30, 1945) the respondent in showing its profits from business sought to deduct Rs. 6,111/ on the ground that this was an expenditure not of a capital nature but wholly and exclusively laid out for the purpose of business under section 10 (2) (XV) of the Income tax Act. This claim was disallowed by the Income tax Officer, and on appeal, by the Appellate Assistant Commissioner. On further appeal to the Appellate Tribunal, the respondent contended that the ruling of the Privy Council in Mohanlal Hargovind 's case (2) applied to the case, inasmuch as the payment was to secure the stock in trade for its business. The Appellate Tribunal, though it was of opinion that the Privy Council case applied, felt itself bound by the earlier Full Bench decision of the Madras High 535 Court in K.T.M.T.M. Abdul Kayoom Hussain Sahib vs Commissioner of Income tax, Madras (1) relating to this respondent, and dismissed the appeal. The Tribunal, however, acceded to a demand for a case, and referred the following question to the High Court for its decision : "Whether on the facts and circumstances of the case the payment of the sum of Rs. 6,111 made by the assessee under the terms of the agreement entered into with the Director of Industries and Commerce, Madras, on 9th November 1945 was not an item of revenue expenditure incurred in the course of carrying on the business of the assessee and, "therefore, allowable under the provisions of section 10 of the Indian Income tax Act". The reference went before a Divisional Bench, which referred the case for decision of a Full Bench. The Full Bench held that the case was covered by the Privy Council case above referred to, observing: "In our opinion, the facts in the case before the Judicial Committee are indistinguishable from the facts of the present case. In one case, the leaves had to be picked from trees by going upon the land, while in the other case the chanks had to be collected and gathered by dividing into the sea. It is impossible to construe the documents in the present case as conferring any interest in that portion of the sea from which the exclusive right of winning the chanks was conferred upon the assessee. " The High Court also did not see any difference between raw materials acquired for a manufacturing business and the acquisition of chanks in the present case, and held that the chanks were acquired as the stock in trade of the respondent and the transaction was tantamount to purchase of goods, 536 The High Court, however, certified the case as fit for appeal, and the Commissioner of Income tax has filed this appeal. The material terms of the agreement in the case are as follows : "1. The lessor hereby grants unto the lessees the full free and exclusive right, liberty and authority to fish or take and carry away all chank shells in the sea off the coast line of the South Arcot District including the French Kuppams of Pondicherry more particularly described in the schedule hereto to hold the premises to the lessees from the first day of July 1944 for a period of three years ending 30th June 1947 paying therefor the yearly rent of Rs. 6, 111 (rupees six thousand one hundred and eleven only) to be paid yearly in advance, the first payment to be made within fifteen days from the date of intimation of acceptance and the second and third payments to be made on or before the 15th June 1945 and 1946, respectively at the Government Treasury at Tuticorin or Madras. x x x 3. The lossee hereby covenants with the lessor as follows : x x x (ii) To deliver to the Assistant Director of Pearl and Chank Fisheries, Tuticorin all Velampuri shells that may be obtained by the lessees upon payment of their value as determined by the Assistant Director. (iii) To collect Chanks in nets and by means of diving as well. In the process of such collection of shell not to fish chank shells less than 2 1/4 inches in diameter if any chank shells less than 2 1/4 inches in diameter 537 be brought inadvertently to shore, to return at once alive to the sea all such undersized shells. (iv) Not at any time hereafter to transfer or underlet or part with possession of this grant or the rights and privileges hereby granted or any part thereof without the written consent of the lessor. x x x (vi) To report to the Assistant Director of Pearl and Chank Fisheries (South), Tuticorin the actual number of shells kept unsold in different stations after the expiry of the lease period. " An analysis of the agreement shows that the respondent obtained an exclusive right to fish for "chanks" by the method of diving and nets and to appropriate them except those below 2 inches in diameter, which had to be returned alive to the sea and Velampuri shells which had to be sold compulsorily to Government. The respondent had also to report to its lessors at the end of the term, the number of shells not sold. The right was exclusive, but was not capable of being transferred or underlet, and it was for a fairly long period. The coast line involved was also fairly long. There is no doubt that the payment of Rs. 6,111/ was an expenditure wholly and exclusively for the purpose of the business of selling shells, just as the payment to the divers and other sundry expenses were. But an expenditure for the purpose of the business may be of a capital nature, and if it is so, it cannot be claimed as a deduction. The question is whether this payment was of a capital nature. What is attributable to capital and what, to revenue has led to a long string of cases here and 538 in the English Courts. The decisions of this Court reported in Assam Bengal Cement Co., Ltd. vs Commissioner of Income tax and Pingle Industries case (1) have considered all the leading cases, and have also indicated the tests, which are usually applied in such cases. It is not necessary for us to cover the same ground again. Further, none of the tests is either exhaustive or universal. Each case depends on its own facts, and a close similarity between one case and another is not enough, because even a single significant detail may alter the entire aspect. In deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo * by matching the colour of one case against the colour of another. To decide, therefore, on which side of the line a case falls, its broad resemblance to another case is not at all decisive. What is decisive is the nature of the business, the nature of the expenditure, the nature of the light acquired, and their relation inter se, and this is the only key to resolve the issue in the light of the general principles, which are followed in such cases. A trader may spend money to acquire his raw materials, or his stock in trade, and the payment may often be on revenue account but not necessarily. A person selling goods by retail may be said to be acquiring his stock in trade when he buys such goods from a wholesaler. But the same cannot be said of another retailer who buys a monopoly right over a long period from a producer of those goods. The amount, he pays to secure the monopoly, through a part of the expenditure to secure his stock in trade is not of the same character as the price he pays in the first illustration. By that payment, he secures an enduring advantage and an asset which is a capital asset of his business. In the same way, if a manufacturer buys his raw materials he makes a revenue expenditure, but when he acquires a source from which he would derive his 539 raw materials for the enduring benefit of his business, he spends on the capital side. Thus, a manufacturer of wollen goods buys his wool buys his raw materials, but when he buys a sheep farm, he buys a capital asset. There is then no difference between purchase of a factory and the purchase of the sheep farm, because both are capital asset of enduring nature. The respondent in this case has tried to distinguish Pingle Industries case (1) and to bring its case within the ruling of the Privy Council in Mohanlal Hargovind 's case (2). When the former case was argued, the attempt was to bring it also within the rule of the Privy Council, but now, the differences between the two cases are recognised and Pingle Industries case (1) is said to be entirely different. In deciding the present appeal, it is hardly necessary to do more than analyses once again the facts and circumstances of these two cases to show why those two cases were differently decided, and the present case will then be easily disposed of, not on its similarity to another but on its own facts. We shall begin with the Privy Council. Mohanlal Hargovind and Co., was a firm of bidi manufacturers, which needs tendu leaves in which tobacco is wrapped to make bidis. Tendu leaves were thus the raw material of the business. Tendu leaves can be bought from dealers who sell tendu leaves in a large way. Now, what did the firm do ? It took leaves of forests with a right to pick the leaves. This right carried with it the right to coppice small tendu plants and to pollard the tendu trees. There was, however, no right in the trees or the land and the right to go over the land was merely ancillary. Looked at from the point of view of business, there was no more than a purchase of the leaves, and the leaves were needed as raw materials of the business. In deciding the case, the Judicial Committee discounted the right to 540 coppice small tendu plants and to pollard the tendu trees as a very insignificant right of cultivation necessary to improve the quality of the leaves, but which right ranked no higher than the right to spray a fruit tree. The right of entry upon the land was also considered ancillary to the main purpose of the contract, which was acquisition of tendu leaves and tendu leaves alone, and it was observed that even if this right of going on the land and plucking the leaves was not expressed in the contract, it would have been implied by law. Their Lordships then observed that the High Court diverted its view from these points, and attached too much importance to cases decided upon quite different facts. They then observed that "cases relating to the purchase or leasing of mines, quarries, deposits of brick earth, land with standing timber. " were of no assistance, and concluded: "If the tendu leaves had been stored in a merchant 's godown and the appellants had bought the right to go and fetch them and so reduce them into their possession and ownership it could scarcely have been suggested that the purchase price was capital expenditure. Their Lordships see no ground in principle or reason for differentiating the present case from that supposed." (p. 478) That case thus involved no right in land or trees; the licence to be on the land was merely an accessory right; the right of cultivation was insignificant. The term was short, and the collection of leaves was seasonal. Leaves once collected, the operation pro tempore was over till the fresh crop came. There was thus no acquisition of an enduring asset in the way capital endures; it was more a purchase of crops of two or three successive years shewered on an agreement to ensure the supply of raw materials, 541 Contrast this with the facts of Pingle Industries case (1). The business of the assessee there, was selling stone slabe called flag stones. These stones were first won from the quarries and then dressed and shaped and then sold. Now, what did the assessee do ? It took leases of stone quarries in a large number of villages for twelve years. Primarily, this was done to obtain stones for its business. It could have been a contract by which it would have been entitled to so many cubic feet of stones to be extracted in a particular period. It took long term leases of vast areas in several villages to ensure supplies for a considerable time. The leases were not limited by quantity, nor did they refer to any stones in particular. It could take all or it could take none; but it could not have carried away all the stones, if the supply outran its efforts. The stones were embedded in earth, layer upon layer, and had to be systematically extracted. Till the stones at the top were removed, it could not remove those at the bottom, and there were still more layers further below. In there circumstances, no specific quantity having been bought or sold either expressly or impliedly, the stones being immovable property or a part thereof and the contract being long teem contracts, Mohahlal Rargovind 's case (2) was held inapplicable, and it was held that the assessee in Pingle Industries case (1) had acquired an enduring asset and the expenditure was on capital account. These cases between them show adequately the dividing line, which exists between capital expenditure and revenue expenditure. To determine on which side of the line the particular expenditure falls, one may often put himself the question posed by Lord Clyde in Robert Addie and Sons Collieries Ltd. vs Commissioners Inland Revenue (3) 542 "It it part of the Company 's working expenses, is it expenditure laid out as part of the process of profit earning ? or, on the other hand, is it capital outlay, is it expenditure necessary for the acquisition of property or of rights of a permanent character, the possession of which is a condition of carrying on its trade at all?" The same question was again posed by the Judicial Committee in Tata Hydro Electric Agencies, Ltd. vs Commissioner of Income tax (1). The answer to this question in each of the two case of Mohanlal Hargovind (2) and Pingle Industries (3) is entirely different. The difference can be noticed easily, if we were to read here what Channell, J. said in Alianza Co. Ltd. vs Bell (4): "In the ordinary case, the cost of the material worked up in a manufactory is not a capital expenditure, it is a current expenditure and does not become a capital expenditure merely because the material is provided by something like a forward contract, under which a person for the payment of a lump sum secures a supply of the raw material for a period extending over several years. .If it is merely a manufacturing business, then the procuring of the raw material would not be a capital expenditure. But if it is like the working of a particular mine, or bed of brick earth and converting the stuff into a marketable commodity, then, the money paid for the prime cost of the stuff so dealt with is just as much capital the money sunk in machinery or buildings. " The first part of the observation is applicable to Mohanlal Hargovind 's case (2) and the latter part, to Pingle Industries case (3). What is said of a manufacturing concern is equally applicable to a non manufacturing business. It is the quality of the payment taken with what is obtained, that is decisive of the character of the payment. 543 We may now pass on to the facts of the case before us. The respondent carried on the business of selling chanks. It obtained its supplies from divers, from whom it purchased the chanks, and having got them, perhaps cheap, it resold them at a profit. This is one mode in which it carried on its business. In this business, it was directly buying its stock in trade for resale. The other method was to acquire exclusive right to fish for chanks by employing divers and nets. The business then changed to something different. The sale was now of the product of another business, in which divers and equipment were first employed to get the shells. It thus took leases of extensive coastline with all the right to fish for chanks for some years. The shells were not the subject of the bargain at all, as were the tendu leaves; but the bargain was about the right to fisht. There can be no doubt that what it paid the divers when it bought chanks from them with the view of reselling them was expenditure laid out wholly and exclusively for the purpose of its business, which was not of a capital nature. That business was buying goods and reselling them at a profit. But a different kind of business was involved when it went in for fishing for chanks. To be able to fish for chanks in reserved waters it had to obtain the right first. It, therefore took lease of that right. To Mohanlal Hargovind, the leaves were raw materials, and that firm preferred to buy a number of crops over years rather than buy them as it went along. Hence the remark that the leaves were bought, as if they were in a shop. Under the lease which the respondent obtained, it had a right to take only chanks of particular dimensions and shape, but it had to fish for them and obtain them first. The rest of the chanks were not its property. The smaller chanks had to be returned alive to the sea, and Velampuri chanks had to be compulsorily sold to the state. Of Course, the smaller chanks put back into the sea 544 would grow, and if fished later, be its property to take, but till they grow, it had not claim. The chanks were on the bed of the sea. Their exact existence was not known, till the divers found them, or they got netted. Chanks which were there one day might have been washed back into the deep sea, and might never be washed back into a place where they would be within reach. Similarly, other chanks not there one day might come within reach on another day. All these matters make the case entirely different from the case of a purchase from the divers. In obtaining the lease, the respondent obtained a speculative right to fish for chanks which it hoped to obtain and which might be in large quantities or small, according to its luck. The respondent changed the nature of its business to fishing for chanks instead of buying them. To be able to fish, it had to arrange for an area to fish, and that arrangement had to be of some duration to be effective. This is not a case of so much clay or so much salt petre or a dump of tailings or leaves on the trees in a forest. The two modes in which the respondent did the business furnish adequate distinguishing characteristics. Here is an agreement to reserve a source, where the respondent hoped to find shells which, when found, became its stock in trade but which, insitu, were no more the firm 's than a shell in the deepest part of the ocean beyond the reach of its divers and nets. The expenses of fishing shells were its current expenses as also the expenses incurred over the purchase of shells from the divers. But to say that the payment of lease money for reserving an exclusive right to fish for chanks was on a par with payments of the other character is to err. It was possible to say of the former, as it was possible to say of the tendu leaves in Mohanlal Hargovind 's case (1), that the chanks were bought because the money paid was the price of the chanks. But it would be a straining of the imagination to say that the amount paid 545 for reserving the coastline for future fishing was the price of chanks, with which the respondent did its business. That amount was paid to obtain an enduring asset in the shape of an exclusive right to fish, and the payment was not related to the chanks, which it might or might not have brought to the surface in this speculative business. The rights were not trasferable, but if they were and the firm had sold them, the gain, if any, would have been on the capital side and not a realising of the chanks as stock in trade, because none had been bought by the firm, and none would have been sold by it. In our opinion, the decision of the High Court, with all due respect, was, therefore, erroneous, and the earlier decision of the Full Bench of the same High Court was right in the circumstances of the case. In the result, the appeal is allowed; but there will be no order about cost. BY COURT. In accordance with the majority judgment of the Court, the appeal is allowed, but there will be no order about costs.

The assessee firm carried on the business in purchase and sale of conch shells. It obtained a lease for 3 years for gathering specified types of shells from the sea along the coastline abutting on the South Arcot District. It sought to deduct the amount paid as lease money from its profits from business on the ground that this was an expenditure not of a capital nature but wholly and exclusively laid out for the purpose of business. under section 10(2)(xy) of the Income Tax Act. ^ Held, (per kapur and Hidayatullah, JJ., Das, J. dissenting) that the expenditure was capital expenditure and could not be deducted from the profits. The business of the assessee was buying and selling shells but when it took the lease it went in for a new speculative business of fishing for shells. The amount paid for reserving the vast coastline for future fishing was not price paid for obtaining the stock in trade i.e. shells with which assessee did his business. The amount was paid to obtain an enduring asset in the shape of an exclusive right to fish and the payment was not related to the shells. Mohanlal Hargovind vs Commissioner of Income tax, C. P. & Berar, , distinguished Pringle Industries Ltd., Secunderabad vs Commissioner of Income tax, Hyderabad, [1960] 3 section C. R. 681, applied. Per Das, J. The expenditure was not capital expenditure and was deductible from the profits. It was not an expenditure for the acquisition of property or of rights of a permanent character, the possession of which was necessary for carrying on of the assessee 's trade By this lease the assessee acquired its stocks in trade rather than a source or enduring asset for producing the stock in trade. Mohanlal Hargovind vs Commissioner of Income tax, C. P. & Berar , applied. Pringle Industries Ltd., Secunderabad vs Commissioner of Income tax, Hyderabad, , distinguished.

Appeal No. 12 of 1952. Appeal from the Judgment and Order dated the 18th January, 1950, of the High Court of Judicature at Madras (Satyanarayana Rao and Viswanatha Sastri JJ.) in Case Referred No. 27 of 1947. O.T. G. Nambiar (section N. Mukherjee, with him) for the appellant. M.C. Setalvad, Attorney General for India, and C. K.Daphtary, Solicitor General for India (G. N. Joshi and P.A. Mehta, with them) for the respondent. December 22. The Judgment of the Court was delivered by MAHAJAN J. This is an appeal from the judgment of the High Court of Judicature at Madras dated 18th January, 1950, delivered on a reference by the Incometax .Appellate Tribunal under section 66(1) of the Indian Income tax Act, whereby the High Court answered the two questions referred in the affirmative. ' The appellant is a public limited company incorporated in the United Kingdom and owns a spinning and weaving mill located at Pondicherry in French Indial. The year of account of the appellant is the calendar year. In the year 1939 no sales of yarn or cloth manufactured by the company were effected in 456 British India, though in the previous year such sales were effected. All the purchases of cotton required for the mills were made in British India by Messrs. Best & Co., Ltd. Under an agreement between the appellant and Messrs. Best & Co., Ltd., Madras, dated 11th July, 1939, Messrs. Best & Co., Ltd. were constituted the agents of the appellant for the purposes of its business in India. Messrs. Best & Co., Ltd. have under the terms of the agreement full powers in connection with the business of the appellant in the matter of purchasing stock, signing bills and other negotiable instruments and receipts and settling, compounding or compromising any claim by or against the appellant. The agents are empowered to borrow money on behalf of the appellant and to make advances. They are also expected to secure the best commissions, brokerages, rebates, discounts and other allowances in respect of and in connection with the business of the appellant. They are enjoined to keep proper accounts of the appellant and to pay over to the appellant the sum standing to its credit. They are remunerated by a salary of Rs. 6,500 per mouth and a percentage commission on the profits made. During the relevant year all the purchases of cotton required for the mill at Pondicherry were made by the agents in British India and no purchases were made through any other agency. The agents exercised their judgment and skill and purchased such qualities and quantities of cotton and at such prices as they in their experience considered most advantageous in the interests of the company. Prior to 1939 40 the appellant was assessed to income tax in British India on the profits computed on a turnover basis earned by the sales in British India of the goods manufactured by the appellant. In the course of the assessment year 1939 40 the appellant stated that it discontinued its business in British India with effect from 1st April, 1939, and claimed relief under section 25`3) which was granted. In the course of his further enquiries the Income tax Officer found 'that though the appellant was not 457 selling its goods in British India and earning a profit thereby, it continued to have an active business connection in British India having regard to the way in which the business of purchasing goods and materials for them ills was carried on. There upon the Incometax officer held that such purchases of cotton in British India constituted a business connection in British India and that the profits attributable to the purchases were liable to tax under sections 42(1) and 42(3) of the Act. The net income of the company was computed to be Rs. 2,81,176 and ten per cent. of this sum was apportioned under section 42(3), of the Act as being the profits and gains reasonably attributable to that part of the business operations, which were carried out in British India. The appellant appealed against the said order of the Income tax Officer to the Appellate Assistant Commissioner who confirmed the order of the Income tax Officer. A further appeal by the appellant to the Tribunal was unsuccessful. At the instance of the appellant, the Tribunal stated a case and referred the following questions for the decision of the High Court under section 66(1) of the Act : " 1. Whether in the circumstances of this case the assessee company had any business connection in British India within the meaning of sections 42(1) and 42(3) of the Income tax Act ? 2.Whether any profits could reasonably be attributed to the purchase of entire cotton made in British India by the secretaries and agents of the assessee company within the meaning of sections 42(1) and 42(3) of the Income tax Act ? The High Court answered both these questions in the affirmative and, in our opinion, rightly. The learned counsel for the appellant reiterated before us the arguments that he had addressed in the High Court and contended that on the facts of this case there was no scope for the finding that any profits or. gains accrued to the assessee directly or 458 indirectly through or from any business connection in India. It was argued that a mere purchase of raw materials or goods in British India does not result in the accrual or arising of profits and that the profits on the sale of goods arise and accrue only at the place where the sales are effected and that in the present case, there being no sales effected in British India in the year of account 1939, no profits accrued or arose to the company in British India nor could ally profits be deemed to have accrued or arisen in British India. In support of his proposition, the learned counsel placed reliance on a number of cases, inter alia, on Board of Revenue vs Madras Export Co.(1), Jiwan Das vs Commissioner of Income tax, Lahore (2), Rahim vs Commissioner of Income tax(3), Commissioner of Incometax, of Income tax vs Little 's Oriental Balm Ltd.(5). Most of these decisions were given under the Act of 1922, before the insertion of section 42 (3) in the Act of 1922 by the amending Act of 1939. As against the cases relied upon by the learned counsel for the appellant, several authorities have been cited to us which have proceeded on the footing that even purchase of raw materials could be an operation in connection with a business and if it was carried on in British India it might make the profits attributable to such operation taxable under section 42 of the Indian Income tax Act. The case Rogers Pyatt Shellac Co. vs Secretary of State for India(6) is one of the leading decisions on this point. This case was decided under section 33 of the Indian Income tax Act, 1918, and the judgment shows that the principle followed in the case was similar to that which was subsequently embodied in section 42 (3) of the Income tax Act, 1922. The question referred to the High Court in that case was in these terms: "Is this company which purchased shellac and mica in India for sale in the open market in America (1) Mad. (2) (I929) 1. L. R. (3) A.I.R. 1949 Orissa 60. (4) A.T.R. (5) [1950) (6) (1925) I.L.R.52 Cal. 459 liable to be assessed to income tax and super tax under either Income tax Act VII of 1918 or Act XI of 1922 and the Super tax Act, VIII of 1917. " And it was answered in the affirmative. The same line of reasoning was adopted by the Rangoon High Court in Commissioner of Income tax Burma vs Steel Bros. Co. '(1). Among recent cases on this point which were decided under section 42 of the Income tax Act, 1922, can be mentioned the case of Motor Union Insurance Co. Ltd. vs Commissioner of Income tax, Bombay(2) and that of Webb Sons & Co. vs Commissioner of Income tax, East Punjab(3). In the last case, the assessee company which was incorporated in the United States of America was carrying on in America the business of manufacturing carpets. Its only business in British India was the purchase through its agent in British India, of wool as raw material for use in the manufacture of carpets. It was held that the purchase was an operation within the meaning of section 42 (3), and the profits from such purchases could be deemed to arise in British India and it was consequently assessable under section 42 (3) of the Indian Income tax Act. The questions referred to the High Court in this case and relevant to this enquiry were these: "(i) Is mere purchase of raw material an operation within the meaning of section 42 (3) of the Act? (ii)Can any profit arise out of mere purchase of raw material?" While answering these questions in the affirmative it was said: "It is clear that the purchase of raw material by a firm of manufacturers is one of the processes or operations which contributes to an appreciable degree to the ultimate profit which is realized on the sale of manufactured articles. " There is thus no uniformity of judicial opinion on the question that the mere act of purchase produces no profit. (1) Rang. (2) A.I.R. 1945 Bom. (3) [1950) 460 In our judgment, the contention of the learned counsel for the appellant, and on which his whole .argument is founded, that it is the act of sale alone from which the profits accrue or arise can no longer be sustained, and has to be repelled in view of the decision of this Court in Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai & Co.(1). That was a case that arose under the Excess Profits Tax Act, XV of 1940. A firm which was resident in British India and carried on the business of manufacturing and selling groundnut oil, and owned some oil mills within British India also owned a mill in Raichur in the Hyderabad State where oil was manufactured. The oil manufactured in Raichur was sold partly within the State of Hyderabad and partly in Bombay. It was held by this Court that the profits of that part of the business, viz., the manufacture of oil at the mill in Raichur accrued or arose in Raichur even though the manufactured oil was sold in Bombay and the price was received there, and accordingly, that part of the profits derived from sales in Bombay which was attributable to the manufacture of the oil in Raichur was exempt from excess profits tax under the proviso to section 5 of the Act. Reference in this case was made to the decision of the House of Lords in In re Commissioners of Taxation vs Kirk (2), wherein it was held that where income was in part derived from the extraction of ore from the soil of New South Wales Colony, and from the conversion in the latter colony of the crude ore into a merchantable product, this income was assessable under the New South Wales Land and Income Tax Assessment Act of 1895, section 15, sub sections 3 and 4, nowithstanding that the finished products were sold exclusively outside the colony. Lord Davey while delivering the judgment of the Privy Council observed as follows : "It appears to their Lordships that there are four processes in the earning or production of this income (I) the extraction of the ore from the soil ; (2) the (1) ; (2) 461 conversion of the crude ore into a merchantable product, which is a manufacturing process; (3) the sale of the merchantable product; (4) the receipt of the moneys arising from the sale. All these processes are necessary stages which terminate in 'money, and the income is the money resulting less the expenses attendant on all the stages. The first process seems to their Lordships clearly within sub section 3, and the second or manufacturing Process, if not within the meaning of ' trade ' in subsection 1, is certainly included in the words any others source whatever in sub section 4. So far as relates to these two processes, therefore, their Lordships think that the income was earned and arising and accruing in New South Wales. " On a parity of reasoning it can well be said in this case that the profits accrue or arise to the appellant from three business processes or operations, those being (1) the purchase of cotton in British India; (2) its conversion by the process of manufacture in Pondicherry into yarn or cloth ; and (3) the sale of the merchantable product, and those have to be apportioned between these three operations. The same line of reasoning was adopted by the Madras High Court in Bangalore Woollen, Cotton & Silk Mills Co. Ltd. vs Commissioner of Income tax, Madras(1). There it was held that the purchase of raw materials by the man aging agents in British India would be an operation within the meaning of section 42(3) and it was reasonable to attribute a portion of the profits to such purchases in British India. After a careful consideration of the decided cases on the subject and in view of the insertion of section 42 (3) in the Act of 1922 by the amending Act of 1939, we have reached the conclusion that in the present state of the law there is hardly any scope for maintaining the view contended for by the learned counsel for the appellant and we therefore agree with the High Court in repelling it. While maintaining the view taken by the High Court in this case we wish (1) 462 to point out that it is not every business activity of a manufacturer that comes within the expression "operation" to which the provisions of section 42(3) are attracted. These provisions have no application unless according to the known and accepted business notions and usages the particular activity is regarded as a well defined business operation. Activities which are not well defined or are of a casual or isolated character would not ordinarily fall within the ambit of this rule. Distribution of profits on different business operations or activities ought only to be made for sufficient and cogent reasons and the observations made here are limited to the facts and circumstances of this case. In a case where all that may be known is that a few transactions of purchase of raw materials have taken place in British India, it could not ordinarily be said that the isolated acts were in their nature " operations " within the meaning of that expression. In this case the raw materials were purchased systematically and habitually through an established agency having special skill and competency in selecting the goods to be purchased and fixing the time and place of purchase. Such activity appears to us to be well within the import of the term " operation " as used in section 42 (3) of the Act. It is not in the nature of an isolated transaction of purchase of raw materials. The first contention of the assessee is therefore negatived. The learned counsel argued in a rather half hearted manner that there was no business connection of the assessee in British India. This contention does not require serious consideration. An isolated transaction between a non resident and a resident in British India without any course of dealings such as might fairly be described as a business connection does not attract the application of section 42, but when there is a continuity of business relationship between the person in British India who helps to make the profits and the person outside British India, who receives or realizes the profits, such relationship does constitute business connection. In this case there 463 was a regular agency established in British India for the purchase of the entire raw materials required for the manufacture abroad and the agent was chosen by reason of his skill, reputation and experience in the line of trade. The terms of the agency stated in by earlier part of this judgment fully establish that Messrs. Best & Co. Ltd. were carrying on something almost akin to the business of a managing agency in India of the foreign company and the latter certainly had a connection with this agency. We therefore negative this contention of the learned counsel as well. For the reasons given above we uphold the view taken by the High Court and dismiss the appeal with costs. Appeal dismissed.

Though a few isolated transactions of purchase of raw mate rials in India by a manufacturer carrying on business outside India may not amount to the carrying on of an " operation " in India within the meaning of section 42 (3) of the Indian Income tax Act, where raw materials are purchased systematically and habitually in India through an established agency having special skill and competency in selecting the goods, such an activity will be an "operation" within a. 42 (3), and the portion of the profits 455 attributable to the purchases in India can be assessed to incometax under section 42(1) and (3) of the Indian Income tax Act. Bangalore Woollen, Cotton & Silk Mills Co. Ltd. vs Commis sioner of Income tax, Madras , Commissioner of Income tax, Bombay vs Ahmedbhai Umarbhai d Co. ([1950] S.C.R. 335), Commissioners of Taxation vs Kirk ([1900] A.C. 588), Rogers Pyatt Shellac Co. vs Secretary of State for India ([1925] I.L.R. and Webb Sons & Co. vs Commissioner of Incometax, East Punjab ([1950] relied on. An isolated transaction between a non resident and a resident in India without any course of dealings such as might fairly be described as a business connection does not attract the application of section 42, but when there is a continuity of business relationship between the person in India who helps to make the profits and the person outside India who receives or realises the profits, such relationship constitutes a business connection.

Civil Appeals Nos. 459 and 460 of 1960 Appeals by special leave from the award dated March 10, 1959, of the Industrial Tribunal, Assam, in Reference No. 16 of 1958. M. C. Setalvad, Attorney General for India, B. Sen, section N. Mukherji and B. N. Ghosh, for the management appellant (in C. A. No. 459 of 60) and the respondent (in C. A. No. 460 of 1960). section T. Desai, A. K. Dutt and Janardan Sharma, for the workmen respondents (in C. A. No. 459 of 60) and the appellants (in C. A. No. 460 of 1960). November 24. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. Civil Appeals Nos. 459 and 460 of 1960 are cross appeals and they arise out of an award pronounced by the Industrial Tribunal, Assam, in an industrial dispute referred by the Assam Government for its adjudication. This industrial dispute was raised against the management of the Tocklai Experimental Station (hereafter called the Station) by its workmen. Six out of the demands made by the workmen formed the subject matter of reference. In the present appeals we are concerned with three of them. Demand No. 1 (a) was that the employees ' junior staff of the Station should be given pension in lieu of the existing practice of paying gratuity. This demand has been rejected be the tribunal. The other demand made by the employees was No. 3(b) and it had reference to the claim for free housing accommodation or adequate allowance in lieu thereof. This demand has been partially allowed by the tribunal and it has directed that house allowance in each case shall be raised at the flat rate of Rs. 20/ instead of Rs. 101/ . The decision of the tribunal in respect of these two demands did not satisfy the workmen and so by special leave of this Court they have filed Civil Appeal No. 460 of 1960. The demand of the 560 junior staff for bonus which was resisted by the Station has been partially allowed by the tribunal. It has ordered that the Station shall give punja bonus at the same rate as the employees working for the Indian Tea Association at Calcutta are getting. This part of the award is challenged by the Station in its appeal by special leave by Civil Appeal No. 459 of 1960. That is how the two cross appeals arise. We will deal first with the Station 's Appeal in respect of bonus. The learned Attorney General contends that in making the demand for bonus the workmen have entirely misconceived the true position of the industrial law on the point, and he argues that the Assam Government was not justified in making the reference in the form it has been made and the tribunal was not justified in making the award in the manner it has done. The workmen made their demand for bonus in these words: "The Union requests the introduction of bonus for the Tocklai Staff on the following grounds". Then follow six grounds. It was urged that the Station is an arm of the tea industry and is maintained by the members of the I.T.A. who give bonus to their employees, that the Station exists and works for the advancement of the tea industry and increasing its profits and thus is an industry, that the I.T.A. employees at Calcutta office are given bonus, that the employees of the Bengal Chamber of Commerce receive bonus, that the employees of Shamshernagar and Tulsipara branches of this very Station used to be given bonus so long as these branches were functioning and that the personnel of the scientific research laboratories attached to many industrial concerns receive bonus, and so the workmen in the present case were entitled to make a claim in that behalf. In appreciating this claim it is necessary to state that the Station is a research institution established by the Indian Tea Association to make research for the purpose of improving the quality of 561 tea and its production and the said Station is managed by the parent Association and is maintained by means of voluntary subscriptions from members of the said Association. Broadly stated the ground on which the workmen claimed bonus was that the employees of the Association were receiving bonus and that the personnel of scientific research laboratories similarly situated in other industrial concerns were also given bonus. When the Assam Government made the present reference it included within the scope of the reference this claim of bonus along with the other claims made by the workmen. The issue referred for adjudication on this point was thus framed: "2(a). Whether the demand of the employees (Junior Staff) for bonus is justified ? If so, at what rate should the same be paid ?" The tribunal considered this demand and partially allowed it by directing that the workmen should be paid puja bonus at the same rate as the employees working in the I.T.A. at Calcutta are getting. In dealing with this question the tribunal has held that the Station is an industry within the meaning of the Industrial Disputes Act and so it could not resist the demand made by its workmen on the ground that it is an academic body devoted to research and as such outside the purview of the Act. This position is not disputed before us by the Station because it is concluded by a decision of this Court in The Ahmedabad Textile Industry 's Research Association vs The State of Bombay (1). The tribunal has, however, found in favour of the Station that it would be inexpedient, if not impossible, to apply the formula which governs the decision of industrial claims for the payment of bonus. "There are obvious difficulties", says the tribunal, "in applying the formula laid down by their Lordships of the Supreme Court to an experimental station run 562 by the Association"; but it added that "it could not be overlooked that payment of bonus to members of the experimental staff is being made by some companies". Then the tribunal referred to some instances where bonus is paid to workmen who, in the opinion of the tribunal, were similarly situated, and it came to the conclusion that refusing the workmen 's claim for bonus against the Station would amount to discrimination. The tribunal then took into account the fact that what is described as puja bonus is paid to members of the staff of the Bengal Chamber of Commerce because it was admitted before it that the junior staff of the Bengal Chamber of Commerce which presumably was also serving the I.T.A. at Calcutta was receiving a fixed annual gratuity characterised as puja bonus. The tribunal conceded that the claim for this kind of bonus "may not directly satisfy the requirements of law", but it added that "the fact that what was described as puja bonus was given at the sub stations and is also given to the clerical staff working at the I.T.A. at Calcutta, supports the demand to this extent at least that the same treatment may be meted out to them. " It is on this reasoning that the tribunal ultimately made the award in favour of the workmen directing the Station to pay puja bonus to its employees. It would be noticed that the demand originally made by the workmen appears to be in the nature of a demand for bonus which is usually described as industrial profit bonus the payment of which is governed by the application of the well known formula. Such a demand is invariably made, and has to be made, by reference to a particular year because the formula which determines claims for profit bonus postulates the examination of the available surplus in the hands of the employer from which bonus may be directed to be paid to the employees. A claim for profit bonus cannot 563 be validly made unless a specific year for which the claim is made is indicated and it is alleged that there is available surplus in the hands of the employer during that year. It is unfortunate that this elementary aspect was overlooked by the workmen when they made the claim and has not been noticed even by the Assam Government when it made the reference in respect of this claim. This serious infirmity in the claim is present even in the award made by the tribunal because the award does not say for what year the bonus should be paid, and like the claim made by the workmen in very general terms for the introduction of bonus the award also seems to make a direction in similar terms for the payment of bonus. In our opinion, this is a patent infirmity in the award. Profit bonus, it is hardly necessary to emphasise, can be awarded only by reference to a relevant year and a claim for such bonus has, therefore, to be made from year to year and has to be settled either amicably between the parties or, if a reference is made, it has to be determined by industrial adjudication. A general claim for the introduction of profit bonus cannot be made or entertained in the form in which it has been done in the present proceedings. Besides, the other serious infirmity in the award is that when a claim for profit bonus was made the tribunal has proceeded to grant puja bonus and that too solely on the ground that the refusal to grant the said claim would amount to discrimination. In our opinion, the approach adopted by the tribunal in dealing with this alternative claim for puja bonus which was not made in the demand and which had not been expressly referred to the tribunal is entirely erroneous. The claim for puja bonus proceeds on entirely different considerations. Customary puja bonus undoubtedly prevails in many industries in Bengal but there are certain tests which have to be applied in 564 determining the validity of the claim. The amount by of way of puja bonus, it must be shown, has been consistently paid by the employer to his employees from year to year at the same rate, that it has been paid even in years of loss and that it has no relation to the profit made by the employer during the relevant year. The course of conduct spreading over a reasonably long period between the employer and the employees in the matter of payment of puja bonus is of considerable importance in dealing with the claim of customary puja bonus [Vide: The Graham Trading Co. (India) Ltd. vs Its Workmen (1)]. A claim for puja bonus can also be made in a proper case of the ground that the payment of such bonus is an implied term in the contract of employment [Vide: Messrs. Ispahani Ltd., Calcutta vs Ispahani Employees ' Union(2). Such a claim again would necessarily involve the consideration of several relevant facts none of which has been alleged or proved in the present proceedings. Therefore, the decision of the tribunal awarding puja bonus to the workmen cannot be sustained. Indeed, in awarding puja bonus to the workmen the tribunal has failed to consider that it was making out an entirely new and inconsistent case for the workmen and granting the said claim without any proof of the relevant facts which would support such a claim. It is rather surprising that even when the tribunal by its award wanted to grant the demand for puja bonus it did not think it necessary to clarify at what rate the said bonus was to be paid. The award is absolutely vague in that behalf and that is another infirmity in the award. Since that is the only point in Civil Appeal No. 459 of 1960 preferred by the Station we must hold that the appeal succeeds and must set aside the award made by the tribunal under issue No. 1 (a). Before we part with this appeal, however, we ought to add that after special leave was granted 565 to the Station to prefer its appeal it applied for stay of the award directing the payment of puja bonus and stay was granted by this Court on condition that the amount of puja bonus should be paid by the Station to its employees on their furnishing security to the satisfaction of the management. Accordingly the Station has paid to its workmen puja bonus for three years. We suggested to the learned Attorney General that in case his appeal were to succeed the Station may consider whether it would partially forego its claim to recover the amount already paid by it to its workmen, and the learned Attorney General, after consulting his client, has stated before us that the Station would forego one third of the total amount paid by it to its employees under the orders of this Court. This one third amount, we were told, is in the neighborhood of Rs. 65,000/ The learned Attorney General also stated that the balance of two third amount which it would recover from its employees can be paid by each one of them either by easy instalments or at the time when he would receive his gratuity or provident fund; the employee may exercise his option in that behalf. It appears that some of the employees who received the said amount have left the service of the Station and at that time have refunded the amount received by them. The Station would be prepared to give back to such employees one third of the said amount. In our opinion, the attitude adopted by the Station in this matter is very fair and it would relieve the workmen from their liability to return one third of the total amount received by them in pursuance of the orders of this Court. That takes us to Civil Appeal No. 460 of 1960 preferred by the workmen. Mr. section T. Desai, who argued this appeal, could not seriously press the workmen 's case against the refusal of the tribunal to allow their demand for pension in lieu of the existing practice of paying gratuity. On a consideration 566 of the relevant facts the tribunal came to the conclusion that this demand was not justified, and, in our opinion the conclusion of the tribunal is well founded. Then, as regards the other demand which is the subject matter of the appeal the tribunal has increased the house allowance at a flat rate of Rs. 20/ instead of Rs. 10/ and this increased rate has been paid by the Station as from the date when the award became enforceable. Mr. Desai contends that the tribunal should have made an award granting the demand for accommodation or in the alternative should have awarded larger amount by way of house allowance. We are not impressed by this argument. A demand for the provision of housing accommodation can be reasonably entertained where it appears that the financial position of the employer can bear the burden involved in the said demand. Under the present economic conditions prevailing in the industry the responsibility for providing housing accommodation cannot reasonably be placed solely on the shoulders of the employer. In due course the problem may have to be tackled by the industry in co operation with the State. The State will have to bear a part of that responsibility [Vide: The Patna Electric Supply Co. Ltd., Patna vs The Patna Electric Supply Workers ' Union (1))]. The tribunal has considered the financial position of the Station, the urgency of the damned made by the workmen, and has come to the conclusion that the demand for housing accommodation was not justified and that the ends of social justices would be met in the present case if a flat rate of enhancement of Rs. 20/ is awarded. It is true that the Station gives housing accommodation for members of the senior staff but as the tribunal has pointed out there are special reasons how more favourable terms have to be offered to senior research staff in order to get the services of properly trained and properly equipped personnel. In our opinion, the tribunal was right in refusing 567 to draw an analogy between the requirements of the senior research staff and the junior staff with whose claims the tribunal was dealing. Therefore, we are not satisfied that there is any substance in the grievance made by the workmen against the award passed by the tribunal in respect of house allowance. The result is Civil Appeal No. 460 of 1960 fails and is dismissed. There would be no order as to costs in both the appeals. Appeal No. 459 allowed. Appeal No. 460 dismissed.

The appellant, a research institution established for the purpose of improving the quality of tea, was managed by the India Tea Assciation. The employees made claims, inter 558 alia, for (1) free housing accommodation or adequate allowance in lieu thereof, and (2) grant of bonus. The tribunal, to which the matter was referred by the Government considered the financial position of the appellant and came to the conclusion that the demand for housing accommodation was not justified and that the ends of justice would be met if a flat rate of enhancement of Rs. 20/ was awarded. As regards the demand for bonus the tribunal felt that it would be inexpedient to apply the formula which governed the decision of industrial claims for the payment of bonus, but made an award directing the appellant to pay puja bonus to its employees on the ground that what was described as puja bonus was being given to workmen who were similarly situated as also to the clarical staff working at the Indian Tea Association at Calcutta and that refusing the workmen 's claim for bonus against the appellant would amount to discrimination. ^ Held, that a demand for the provision of housing accommodation can be reasonably entertained where it appeared that the financial position of the employer can bear the burden involved, that under the present economic conditions prevailing in the industry the responsibility for providing housing accommodation cannot be placed solely on the shoulders of the employer, and that in due course the problem would have to be tackled by the industry in cooperation with the State, which would have to bear a part of that responsibility. The Patna Electric Supply Co., Ltd. Patna vs The Patna Electric Supply Workers ' Union, [1959] Supp. S.C. R. 761, relied on. Held, further, that before a claim for the grant of puja bonus could be sustained it must be shown (1) that it was consistently paid by the employer to his employees from year to year at the same rate, and (2) that it had been paid even in years of loss and that it had no relation to the profit made by the employer during the relevant year. A claim for puja bonus could also be made on the ground that the payment of such bonus was an implied term in the contract of employment. The Graham Trading Co. (Indian) Ltd. vs Its Workmen, ; and M/s. Ispahani Ltd., Calcatta vs Ispahani Employees ' Union, [1960] 1 S.C.R. 24, followed. Industrial profit bonus which is governed by the application of the well known formula, cannot be awarded unless a specific year for which the claim is made is indicated and it is alleged that there is available surplus in the hands of the employer for that year.